Ted Grant

Against the Theory of State Capitalism

Reply to Comrade Cliff

The document of Comrade Cliff entitled The Nature of Stalinist Russia[source] at
first sight gives the impression of erudition and scientific analysis. However,
upon careful examination, it will be observed that not one of the chapters contains
a worked-out thesis. The method is a series of parallels based on quotations,
and its basic weakness is shown by the fact that conclusions are not rooted
in the analysis. From his thesis it is not possible to conclude whether
Stalinist Russia remains a progressive system (despite its deformations), or
whether for Cliff it has now assumed the same reactionary role as ‘individual’
capitalism or fascism. The weakness is sharply brought out by the fact that
no practical conclusions emerge. Is Russia to be defended, or is the revolutionary
party to be defeatist? Instead of the answer being rooted in and flowing from
the analysis, it has to be worked out a posteriori.

Despite the fact that Comrade Cliff asserts that the Stalinist bureaucracy
is a new class, nowhere in his thesis is a real analysis made or evidence adduced
as to why and how such a class constitutes a capitalist class and is not a new
type of class.

And this is not accidental. It flows from the method. Starting off with the
preconceived idea of state capitalism, everything is artificially fitted into
that conception. Instead of applying the theoretical method of the Marxist teachers
to Russian society in its process of motion and development, he has scoured
the works to gather quotations and attempted to compress them into a theory.

Nowhere in the document does Cliff pose the main criterion for Marxists in
analysing social systems: Does the new formation lead to the development
of the productive forces? The theory of Marxism is based on the material
development of the forces of production as the moving force of historical progress.
The transition from one system to another is not decided subjectively, but is
rooted in the needs of production itself. It is on this basis and this basis
only that the superstructure is erected: of state, ideology, art, science. It
is true that the superstructure has an important secondary effect on production
and even within certain limits, as Engels explained, develops its own independent
movement. But in the last analysis, the development of production is decisive.

Marx explained the historical justification for capitalism, depite the horrors
of the industrial revolution, despite the slavery of the blacks in Africa, despite
child labour in the factories, the wars of conquest throughout the globe - by
the fact that it was a necessary stage in the development of the forces of production.
Marx showed that without slavery, not only ancient slavery, but slavery in the
epoch of the early development of capitalism, the modern development of production
would have been impossible. Without that the material basis for communism could
never have been prepared. In Poverty of Philosophy Marx wrote:

"Direct slavery is just as much the pivot of bourgeois industry as machinery,
credits, etc. Without slavery you have no cotton; without cotton you have no
modern industry. It is slavery that has given the colonies their value; it is
the colonies that have created world trade, and it is world trade that is the
precondition of large-scale industry. Thus slavery is an economic category of
the greatest importance.

"Without slavery North America, the most progressive of countries, would
be transformed into a patriarchal country. Wipe out North America from the map
of the world, and you will have anarchy - the complete decay of modern commerce
and civilisation."
[source]

Of course, the attitude of Marx towards the horrors of slavery and the industrial
revolution is well known. It would be a gross distortion of Marx’s position
to argue that because he wrote the above, therefore he was in favour of slavery
and child labour. No more can it be argued against the Marxists of today that
because they support state ownership in the USSR that they therefore justify
the slave camps and other crimes of the Stalin regime.

Marx’s support of Bismarck(1) in the Franco-Prussian war was dictated by similar considerations.
In spite of Bismarck’s ‘blood and iron’ policy and the reactionary nature of
his regime, because the development of the productive forces would be facilitated
by the national unification of Germany, Marx gave critical support for the war
of Prussia against France. The basic criterion was the development of the productive
forces. In the long run, all else flows from this.

Any analysis of Russian society must start from that basis. Once Cliff admits
that while capitalism is declining and decaying on a world scale, yet preserving
a progressive role in Russia in relation to the development of the productive
forces, then logically he would have to say that state capitalism is the next
stage forward for society, or at least for the backward countries. Contradictorily,
he shows that the Russian bourgeoisie was not capable of carrying through the
role which was fulfilled by the bourgeoisie in the West and consequently the
proletarian revolution took place.

If we have state capitalism in Russia (ushered in by a proletarian revolution),
then it is clear that the crisis of capitalism on which we have based ourselves
for the past decades was not insoluble but purely the birth pangs of a new and
higher stage of capitalism. The quotation he himself gives from Marx - that
no society passes from the scene till all the possibilities in it have been
exhausted would indicate that if his argument is correct, a new epoch, the epoch
of state capitalism, opens up before us. This would shatter the entire theoretical
basis of the Leninist-Trotskyist movement. Cliff says, without explaining why,
that if we hold on to the theory of the degenerated revolution, we must abandon
the theory of the permanent revolution. Yet he fails to see that to accept the
theory of state capitalism, the theory of the permanent revolution, which is
based on the idea that capitalism has so exhausted itself on a world scale that
it is incapable of even carrying out the tasks of the bourgeois democratic revolution
in backward countries, would have to be abandoned. For in Eastern Europe, the
‘state capitalists’ would have carried out the tasks of the bourgeois revolution
on the land etc. Cliff skirts around this question of the agrarian revolution,
which in the backward countries, Trotsky argued, only the proletariat could
carry through. If the ‘state capitalist’ parties of the Stalinists can perform
this task, not only is the theory of the permanent revolution thrown out of
the window, but the viability of the new state capitalism in a historical sense
must be clear to all.

If Comrade Cliff’s thesis is correct, that state capitalism exists in Russia
today, then he cannot avoid the conclusion that state capitalism has been in
existence since the Russian Revolution and the function of the revolution itself
was to introduce this state capitalist system of society. For despite his tortuous
efforts to draw a line between the economic basis of Russian society before
the year 1928 and after, the economic basis of Russian society has in fact remained
unchanged.

Incorrect Usage of Quotations

Comrade Cliff seeks to prove that Trotsky was moving to the position that the
bureaucracy was a new ruling class. For this purpose he gives quotations from
the book Stalin, and then from Living Thoughts of Karl Marx.

Cliff writes:

"A clear step in the direction of a new evaluation of the bureaucracy
as a ruling class finds expression in Trotsky’s last book, Stalin. He
writes:

"’The substance of Thermidor was, is and could not fail to be social in
character. It stood for the crystallisation of a new privileged stratum, the
creation of a new substratum for the economically dominant class. There were
two pretenders to this role: the petty bourgeoisie and the bureaucracy itself.
They fought shoulder to shoulder (in the battle to break) the resistance of
the proletarian vanguard. When that task was accomplished a savage struggle
broke out between them. The bureaucracy became frightened of its isolation,
its divorce from the proletariat. Alone it could not crush the kulak
(2)
nor the petty bourgeoisie that had grown and continued to
grow on the basis of the NEP; it had to have the aid of the proletariat. Hence
its concerted effort to present its struggle against the petty bourgeoisie for
the surplus products and for power as the struggle of the proletariat against
attempts at capitalistic restoration’." (The Nature of Stalinist Russia, Tony Cliff, June 1948, page 10)
[source]

And Comrade Cliff comments:

"The bureaucracy, Trotsky says, while pretending to fight against the
capitalistic restoration, in reality used the proletariat only to crush the
kulaks for ‘the crystallisation of a new privileged stratum, the creation of
a new substratum for the economically dominant class’. One of the pretenders
to the role of the economically dominant class, he says, is the bureaucracy.
Great emphasis is lent to this formulation when we connect this analysis with
the fight between the bureaucracy and the kulaks with Trotsky’s definition of
the class struggle. He says: ‘The class struggle is nothing else than the struggle
for surplus produce. He who owns surplus-produce is master of the situation
- owns wealth, owns the state, has the key to the Church, to the courts, to
the sciences and to the arts’." (Cliff, page 10)

And Cliff concludes:

"The fight between the bureaucracy and the kulaks was, according to Trotsky’s
last conclusion, the ‘struggle...for the surplus products’."

To illustrate the way in which Comrade Cliff has constructed his case, let
us examine these quotations in context and we will see that the conclusion
that flows is precisely the opposite to what he argues:

"The kulak, jointly with the petty industrialists, worked for the complete
restoration of capitalism. Thus opened the irreconcilable struggle over the
surplus product of national labour. Who will dispose of it in the nearest
future - the new bourgeoisie or the Soviet bureaucracy? - that became the next
issue. He who disposed of the surplus product has the power of the state at
his disposal. It was all this that opened the struggle between the petty bourgeoisie,
which had helped the bureaucracy to crush the resistance of the labouring masses
and of their spokesmen the Left Opposition, and the Thermidorean bureaucracy
itself, which had helped the petty bourgeoisie to lord it over the agrarian
masses. It was a direct struggle for power and income.

"Obviously the bureaucracy did not rout the proletarian vanguard, pull
from the complications of the international revolution, and legitimise the philosophy
of inequality in order to capitulate before the bourgeoisie, become the latter’s
servant, and be eventually itself pulled away from the state feed-bag."
(Stalin by Leon Trotsky, Harper, London 1941, page 397, our emphasis)

Cliff makes Trotsky look foolish by appearing to contradict himself by juxtaposing
the two quotations and adducing therefrom that Trotsky was changing his position
on the class character of the bureaucracy. A few pages further on, Trotsky explains
his idea. he shows the organic tendency of the decay of capitalism everywhere.
It is only on this basis that the nationalised productive forces have been maintained
in Russia. The whole tendency of the economy in the last 50 years on a world
scale has been towards the statification of the productive forces. The capitalists
themselves have in part been compelled to ‘the recognition of the productive
forces as social forces’ (Engels). In fact, this is the key to the explanation
of why Russia survived the war. The disorientation of the movement which is
expressed in Cliff’s document, is largely due to the failure to appreciate the
implications of this tendency. In his book on Stalin, Trotsky raises the theoretical
possibility of the bureaucracy continuing to rule for some decades.

A few pages after the quotations given by Cliff, Trotsky says:

"The counter-revolution sets in when the spool of progressive social conquests
begins to unwind. There seems no end to this unwinding. Yet some portion of
the conquests of the revolution is always preserved. Thus, in spite of monstrous
bureaucratic distortions, the class basis of the USSR remains proletarian. But
let us bear in mind that the unwinding process has not yet been completed, and
the future of Europe and the world during the next few decades has not yet been
decided. The Russian Thermidor would undoubtedly have opened a new era of bourgeois
rule, if that rule had not proved obsolete throughout the world. At any rate
the struggle against equality and the establishment of very deep social differentiation
has so far been unable to eliminate the socialist consciousness of the masses
or the nationalisation of the means of production and the land, which were the
basic socialist conquests of the revolution..." (Stalin, page
405)

We believe this sufficiently demonstrates that Cliff has taken a quotation
from Trotsky’s Stalin out of context and read something into it which is not
there. In his last work, as in all others on the Russian question, Trotsky had
a consistent theme in his characterisation of the Soviet Union. It is not possible
to draw the conclusion from any of his writings that he was altering his fundamental
position.

Can there be a Struggle between Two Sections of the Same Class? French Revolution
- Russian Revolution

To understand the Russian Revolution we can take the analogy of the French
Revolution which is striking in its similarity and course although obviously
on a different economic basis. As is known, the rule of the bourgeoisie was
ushered in in France in the revolution of 1789. Marx explains the progressive
rule of the revolutionary Jacobins: this revolutionary dictatorship of the sans
culottes went further than the bourgeois regime. Because of that they made
a clean sweep of all feudal rubbish, and did in months what the bourgeoisie
would have required decades to achieve. This was followed by the Thermidorian
reaction and the Bonapartist counter-revolution.

Anyone who compared the Bonapartist counter-revolution with the revolution
- at least in its superstructure - would have found as great a difference as
between the regime of Lenin and Trotsky in Russia and that of Stalin in latter
years. To superficial observers the difference between the two regimes was fundamental.
In fact, insofar as the superstructure was concerned, the difference was glaring.
Napoleon had reintroduced many of the orders, decorations and ranks similar
to those of feudalism; he had restored the Church; he even had himself crowned
Emperor. Yet despite this counter-revolution, it is clear that it had nothing
in common with the old regime. It was counter-revolution on the basis of
the new form of property introduced by the revolution itself. Bourgeois
forms of property or property relations remained the basis of the economy.

When we study the further history of France, we see the variety of forms of
government and of the superstructure which developed in the course of the class
struggle. The restoration of the monarchy after the defeat of Napoleon, the
revolutions of 1830 and of 1848 - what was the class struggle there?
There was a different division of the income, but after all these revolutions
the economy remained bourgeois.

The subsequent history of France saw the dictatorship of Louis Bonaparte, the
restoration of bourgeois democracy and the Republic and, in recent days, the
regime of Petain. Under all these regimes there were differences in the division
of the national income between the classes and between different strata of the
ruling class itself. Yet we call all these regimes bourgeois. Why? It can only
be because of the form of property.

Given the backwardness of the Soviet Union, which is very well explained by
Cliff, and the isolation of the revolution, why should not a similar process
take place? In fact it did. Let us return to Trotsky’s book Stalin. The
Old Man was clear. After the quotation where Trotsky shows that the substance
of the Thermidor could not but be social in character and was the struggle for
the surplus product, he went on to explain what was meant. Let us continue where
Cliff stopped:

"Here the analogy with French Thermidor ceases. The new social basis of
the Soviet Union became paramount. To guard the nationalisation of
the means of production and of the land, is the bureaucracy’s law of life and
death, for these are the social sources of its dominant position. That was
the reason for its struggle against the kulak. The bureaucracy could wage this
struggle, and wage it to the end, only with the support of the proletariat.
The best proof of the fact that it had mustered this support was the avalanche
of capitulations by representatives of the new Opposition.

"The fight against the kulak, the fight against the right wing, the fight
against opportunism - the official slogans of that period - seemed to the workers
and to many representatives of the Left Opposition like a renaissance of the
dictatorship of the proletariat and the socialist revolution. We warned them
at the time: it is not only a question of what is being done, but also
of who does it. Under conditions of Soviet democracy, ie, self-rule of
the toilers, the struggle against the kulaks might not have assumed such a convulsive,
panicky and bestial form and might have led to a general rise of the economic
and cultural level of the masses on the basis of industrialisation. But the
bureaucracy’s fight against the kulak was single combat (fought) on the backs
of the toilers; and since neither of the embattled gladiators trusted the masses,
since both feared the masses, the struggle assumed an extremely convulsive and
sanguinary character. Thanks to the support of the proletariat, it ended with
victory for the bureaucracy. But it did not lead to a gain in the specific weight
of the proletariat in the country’s political life." (Stalin page
408, our emphasis)

When Trotsky speaks here of ‘the creation of a new substratum for the economically
dominant class’ what is clearly meant is the proletariat, which dominates through
the form of property. Cliff says: ‘One of the pretenders to the role
of the economically dominant class, he says, is the bureaucracy. Great emphasis
is lent to this formulation...’ Here we see the dangers in the
method of working on the basis of preconceived ideas and the attempt to select
quotations to fit into these ideas.

In this same chapter, Trotsky shows the similarity and the differences with
the French revolution and why the reaction took a different form in France to
that which it took in Russia:

"The privileges of the bureaucacy have a different source of origin. The
bureaucracy took for itself that part of the national income which it could
secure either by the exercise of force or of its authority or by direct intervention
in economic relations. In the matter of the national surplus product the bureaucracy
and the petty bourgeoisie quickly changed from alliance to enmity. The control
of the surplus product opened the bureaucracy’s road to power." (Stalin,
page 40)

The theme of Trotsky is sufficiently clear. The struggle for the surplus product
can be waged not only between different classes, but between different strata
and different groupings representing the same class.

Does the law of Value Operate within the Russian Economy?

The whole of the section of Cliff’s document on the law of value is unsound
from a Marxist point of view. In the most involved and peculiar manner he argues
that the law of value does not apply within the Russian economy, but only in
its relations to world capitalism. He finds the basis of the law of value, not
in Russian society, but in the world capitalist environment.

"Let us now find out what importance the internal relations in Russia
has when abstracted from the influence of world economy.

"The abstraction has solved one fundamental question: that the source
of the activity of the law of value is not to be found in the internal
relations of Russian economy itself. In other words it has brought us so
far nearer solving the problem of whether the Russian economy is subordinated
to the law of value by showing us where not to look for its source."
(Cliff, page 98. Emphasis in original)

According to the Marxist view, it is in exchange that the law of value
manifests itself. And this holds true for all forms of society. For example,
the way in which the break-up of primitive communism took place was through
the exchange and barter between different primitive communities. This led to
the development of private property. In slave society, in the same way, the
products of the slave became commodities when they were exchanged. Through
this development, the ‘commodity of commodities’ appeared: money. It was thus
that the product enslaved the producer and in the end the contradiction caused
by the money economy resulted in the destruction of the old slave society. Under
feudalism, the exchange of the surplus produced by the self-sufficient
lords and barons in their ‘natural economy’ became commodities, and in fact,
was the starting point of capitalist development through the rise of merchant
capital.

Therefore, if it was in exchange only between Russia and the outside world
that the law of value manifested itself, all that this would mean is that the
Russian surplus was exchanged on the basis of the law of value. What
consequences that would have for the internal economy is a different question
which would have to be worked out.

However, because of the small degree of participation of the Soviet Union on
the world market, in comparison with the total production of Russia, Cliff unavoidably
realises the weakness of this point. Thus, amazingly, Cliff finds the law of
value manifesting itself not in exchange, but in competition. Even
this would not be so bad if he argued that this was competition on the world
market on classical capitalist lines for markets. But he cannot argue this because
it is at variance with the facts. So he introduces a new conception. He finds
his ‘competition’ and his ‘law of value’ in the production of armaments!

The pressure of world capitalism forces Russia to devote an enormous proportion
of the national income on armaments production and defence on the one hand,
and the greatest capital construction in history in proportion to the national
income for the needs of defence, on the other. Here Cliff finds his law of value.
The law of value manifests itself in the armaments competition between two social
systems! This can only be described as a concession to Shachtman’s theory of
bureaucratic collectivism. If this theory is correct, the theory of an entirely
new economy, never before seen in history or foreseen by the Marxists, would
apply.

Here again we would point out the dangers of indiscriminate use of quotations
and amalgamations of ideas to form a ‘thesis’. In reality this document is not
a state capitalist document; it is a hybrid in the union of bureaucratic collectivism
and state capitalism. If this section of Cliff’s document means anything at
all, it leads straight to the road of Schachtman’s bureaucratic collectivism.

This idea is partially borrowed from Hilferding(3)
who consistently argued that in Russia and in Nazi Germany
the law of value did not apply and that these were entirely new social formations.
It is also based on a misunderstanding of some passages in Bukharin’s Imperialismand the World Economy, where he argued on the basis of ‘state capitalism’
- the organic union of trusts with finance capital - and in which he, together
with Lenin, brilliantly prophesied a form of dictatorship which was later realised
in Italian fascism and nazism. Not state ownership of the means of production,
but the fusion of finance capital with the state. In fact Bukharin chose as
one of his classic examples of such a state...America.

The argument on armaments partakes of a mystical and not an economic category.
At best, even if we accepted it as correct, it would only explain why Russian
produces armaments, but not how or on what economic basis the armaments
are produced. Even if Russia were a healthy workers’ state, in imperialist encirclement,
there would be the absolute necessity to produce armaments and compete with
the arms technique and production of the rival capitalist systems. But this
argument about armaments is entirely false. The greater part of production in
Russia is not armaments but means of production. Again, this would explain why
the bureaucracy is attempting to accumulate the means of production at a frantic
speed, but it explains nothing of the economic system of production itself.
It is probably true that in a healthy workers’ state accumulation of arms would
be smaller for social reasons (internationalist and revolutionary policy towards
workers in other lands), but it would nevertheless take place under the pressure
of world imperialism.

A quicker or slower tempo in the development of the means of production does
not necessarily tell us the method by which these are produced. Cliff says that
the bureaucracy is developing the means of production under the pressure of
world imperialism. Good. But all this tells us again is why the pace is fast.
From the point of view of even classical bourgeois political economy, Cliff’s
argument is a pure evasion. It merely poses what has to be proved.

Not for nothing did Trotsky point out in Revolution Betrayed that the
whole progressive content of the activity of the Stalinist bureaucracy and its
preoccupation, was the raising of the productivity of labour and the defence
of the country.

We have seen that if the law of value only applies because of the existence
of capitalism in world economy, then it would only apply to those products
exchanged on the world market. But Cliff argues two contradictory theses
in relation to the Russian economy. On the one hand he says:

"This does not mean that the price system in Russia is arbitrary, dependent
on the whim of the bureaucracy. The basis of price here too is the costs of
production. If price is to be used as a transmission belt through which
the bureaucracy directs production as a whole, it must fit its purpose, and
as nearly as possible reflect the real costs, that is, the socially necessary
Labour absorbed in the different products..." (Cliff, page
94, our emphasis)

Two pages later, Cliff describes as the central point he intends to
prove:

"...that in the economic relations within Russia itself one
cannot find the autonomy of economic activity, the source of the law
of value, acting." (Cliff, page 96, emphasis in original)

In the first quotation, Cliff shows precisely the way in which the law of
value manifests itset internally in Russian society. Even if one abstracts
from the world market, leaving aside the interacting effect which it undoubtedly
has - when Cliff says that ‘the real costs, that is the socially necessary labour
absorbed in the different products’ must reflect the real prices, he is saying
that the same law applies in Russian society as in capitalist society. The difference
is that whereas in capitalist society it manifests itself blindly by the laws
of the markets, in Russia conscious activity plays an important role. In this
connection the second quotation crushingly refutes Cliff’s argument that it
is capitalism which exists in Russia under these given conditions because
the law of value does not operate blindly, but is consciously harnessed. In
capitalist society, the law of value, as he says, manifests itself through the
‘autonomy of economic activity’, ie, it is the market which dominates. The first
quotation shows clearly that the market - and this is the point - is within
given limits controlled consciously and therefore it is not capitalism as understood
by Marxists.

Previously Cliff said that the law of value did not operate in Russia. Here
he is showing precisely how it does operate: not on the lines of classical capitalism,
but of a transitional society between capitalism and socialism.

We see therefore, that Cliff claims that Russia is a capitalist society - yet
he finds the source of the basic law of capitalist production outside of Russia.
Now, in any capitalist society in which the reserve fund is in the hands of
the capitalist class, as Engels explained:

"... if this production and reserve fund does in fact exist in the hands
of the capitalist class, if it has in fact arisen through the accumulation of
profit...then it necessarily consists of the accumulated surplus of the product
of labour handed over to the capitalist class by the working class, over and
above the sum of wages paid to the working class by the capitalist class. In
this case, however, it is not wages that determine value, but the quantity of
labour; in this case the working class hands over to the capitalist class in
the product of labour a greater quantity of value than it receives from it in
the shape of wages; and then the profit on capital like all other forms of appropriation
without payment of the labour product of others, is explained as a simple component
part of the surplus value discovered by Marx." (Anti-Dühring, Progress
Publishers, Moscow 1969, page 233)
[source]

This indicates that where there is wage labour, where there is the accumulation
of capital, the law of value must apply, no matter in how complicated
a form it may manifest itself. Further on Engels explains in answer to Dühring’s(4)
five kinds of value, and the ‘natural costs of production’, that in Capital
Marx is dealing with the value of commodities and ‘in the whole section of Capital
which deals with value there is not even the slightest indication of whether
or to what extent Marx considers the theory of value of commodities applicable
to other forms of society’. In this sense it is clear that in the transitional
society also: ‘Value itself is nothing more than the expression of the socially
necessary labour materialised in an object.’ Here it is only necessary to ask:
what determines the value of machines, consumer goods, etc, produced in Russia?
Is it arbitrary? What determines the calculations of the bureaucracy? What is
it that they measure in price? What determines wages? Are wages payments for
labour power? What determines ‘money’? What determines profits of enterprises?
Is there capital? Is the division of labour abolished?

Cliff gives two contradictory answers to these questions. On the one hand he
agrees that it is the law of value on which all calculations and the movement
of Russian society develops. On the other, he finds the law of value only operating
as the result of pressure from the outside world although how he does not explain
in any serious way.

The Role of Money in Russia

The surprising thing is that Cliff himself points out that the bureaucracy
does not and cannot determine prices arbitrarily. That it does not and cannot
determine the amount of money in circulation arbitrarily either. And this has
been so in every society where money (let us remember, the commodity of commodities)
has played a role. Engels, dealing with this problem, pertinently asked Dühring:

"If the sword (no matter who wields it - bureaucrat, capitalist, or government
- EG) has the magic economic power ascribed to it by Herr Dühring, why is it
that no government has been able to succeed in permanently compelling bad money
to have the ‘distribution value’ of good money, or assignats to have the ‘distribution
value’ of gold? (Anti-Dühring, page 228)
[source]

In Revolution Betrayed, Trotsky explains this problem very clearly.
He shows that the economic categories peculiar to capitalism still remain in
the transitional society between capitalism and communism, the dictatorship
of the proletariat. Here is the key: the laws remain, but are modified. Some
of the laws of capitalism apply and some are abrogated. For example, Trotsky
argues:

"The role of money in Soviet economy is not only unfinished but, as we
have said, still has a long growth ahead. The transitional epoch between capitalism
and socialism taken as a whole does not mean a cutting down of trade but, on
the contrary, its extraordinary extension. All branches of industry transform
themselves and grow. New ones continually arise, and all are compelled to define
their relations to one another both quantitatively and qualitatively. The liquidation
of the consummatory peasant economy, and at the same time of the shut-in family
life, means a transfer to the sphere of social interchange, and ipso facto
money circulation, of all the labour energy which was formerly expended
within the limits of the peasant’s yard, or within the walls of his private
dwelling. All products and services begin for the first time in history
to be exchanged for one another." (Revolution Betrayed, NY,
1972, page 67, our emphasis)
[source]

What is the key to this enigma? It can only be found in the fact that we have
here a transitional society. The state can now regulate, but not arbitrarily,
only within the confines of the law of value. Any attempt to violate and
pass beyond the strict limits set by the development of the productive forces
themselves, immediately results in the re-assertion of the domination of production
over producer. This is what Stalin had to discover in relation to price and
money when the Russian economy was inflicted with a crisis of inflation which
completely distorted and disrupted the plan. The law of value is not abolished,
but is modified. This is what Trotsky meant when he said:

"The nationalisation of the means of production and credit, the co-operativising
or state-ising of internal trade, the monopoly of foreign trade, the collectivisation
of agriculture, the law of inheritance - set strict limits upon the personal
accumulation of money and hinder its conversion into private capital (usurious,
commercial and industrial). These functions of money, however, bound up as they
are with exploitation, are not liquidated at the beginning of a proletarian
revolution, but in a modified form are transferred to the state, the universal
merchant, creditor and industrialist. At the same time the more elementary functions
of money as measure of value, means of exchange and medium of
payment, are not only preserved, but acquire a broader field of action than
they had under capitalism." (Revolution Betrayed, page 66,
emphasis in original)[source]

One has only to pose the problem in this way to see that an economic analysis
must lead one to conclude that we have here a transitional society in which
some of the laws peculiar to socialism apply and some peculiar to capitalism.
That is after all, the meaning of transition.

Although Cliff does not recognise this, in fact he admits it, because when
he says that the bureaucracy can consciously regulate (though within limits)
the rate of investment, the proportions between means of production and means
of consumption, the price of articles of consumption, etc, he is proving
that certain of the basic laws of capitalism do not apply.

Is there a transformation of money into capital in Russia? In polemicising
against Stalin, Trotsky answers this by showing that the investments are made
on the basis of a plan, but nevertheless, what is invested is the surplus
value produced by the workers. Here Trotsky shows the basic fallacy in Stalin’s
idea that the state could decide and regulate without reference to the economy.
We might add that Stalin never denied that there was commodity production in
Russia.

In spite of the fact that there is only one ‘employer’ in Russia, nevertheless,
the state buys labour power. It is true that because of the full employment
which would normally place the seller of the commodity labour power in a strong
position, the state has imposed various restrictions on the free sale of labour
power, just as in a period of full employment under fascism. Or even in Labour
Britain, where the same situation exists, by means of regulations and devices
the employers have the state intervene to offset the advantages which accrue
from this situation for the sale of labour power. But only one who argued in
abstractions, could argue that this negated labour power.

It is true that in the classical capitalist economy there was free sale of
labour power. However, in Marx’s Capital itself there was a whole section
devoted to showing the ferocious laws which were introduced against the nascent
proletariat after the Black Death in England had so reduced the population that
the proletarians were in a favourable position to demand higher wages. Did this
mean that the basic Marxian laws did not apply? On the contrary, Marx was dealing
with a ‘pure’ capitalism which never did exist, from which he extracted the
fundamental laws. The distortion of this or that element will not alter the
basic laws. That is why in nazi Germany, despite many perversions, it remained
fundamentally a system of capitalist economy, because the economy was dominated
by production on the basis of private property.

One has only to compare the slave labourer in Siberia with the proletariat
in the Russian cities to see the difference. The one is a slave based on slave
labour, the other is a wage slave. The one sells his labour power, the other
is purely an instrument of labour himself. There is the fundamental distinction.

It is not at all accidental that the ‘money’ used by the state must necessarily
have the same basis as money in capitalist society. Not accidentally, as
Trotsky explained, the only real money in Russia (or in any transitional
economy - even an ideal workers’ state) must be based on gold. The recent
rouble devaluation in Russia was in itself a striking confirmation of the fact
that the law of money circulation, and thus of the circulation of commodities,
maintains its validity in Russia. In a transitional economy the economic categories
of money, value, surplus value, etc, must necessarily continue as elements of
the old society within the new society.

Cliff argues that ‘the most important source of state income is the turn-over
tax, which is an indirect tax.’ He introduced interesting material showing the
tremendous burden which the turn-over tax imposes upon the masses.

However, the turn-over tax to which he refers in connection with the exploitation
of the masses, in an indirect way, proves that the law of value applies in Russian
society. Cliff shows how the turn-over tax applies in Russia. But he
does not see that this tax must be based on something. No matter how
much the state might add to the price by placing an additional tax, the price
must be based on something: what else can this be but the value of the product,
the socially necessary labour time contained in it?

Engels ridiculed Dühring’s tax by the sword, out of which the surplus is developed,
when he said:

"Or, on the other hand, the alleged tax surcharges represent a real sum
of value, namely that produced by the labouring, value-producing class but appropriated
by the monopolist class, and then this sum of value consists merely of unpaid
labour; in this event, in spite of the man with the sword in his hand, inspite of the alleged tax surcharges, we come once again to the Marxian
theory of surplus value." (Anti-Dühring, page 226)
[source]

The turn-over tax in Russia and the other manipulations of the bureaucracy
do not in any way invalidate the law of value. What is the essence of the law
of value? That the value of the product is determined by the average amount
of socially necessary labour time. That must be the point of departure. It
necessarily manifests itself through exchange. Marx devoted a great part
of his first volume of Capital to explaining the historical development
of the commodity form from accidental exchange among savages through its transitions,
till we arrive at commodity production par excellence, capitalist production.

Even in a classical capitalist economy the law of value does not reveal itself
directly. As is known, commodities are sold above or below their value. Only
accidentally would a commodity be sold at its actual value. In the third volume
of Capital Marx explains the price of production of commodities. That
is to say, that the capitalist only gets the cost of production of his commodity
plus the average rate of profit. Thus some capitalists will be paid below the
actual rate, others above. Because of the different organic composition of different
capitals, only in this complicated fashion does the law of value reveal itself.
This is effected, of course, through competition. Monopoly is merely a more
complicated development of the law of value in society. Because of the controlling
position held by some monopolies, they can extort a price above the value of
the commodities, but only by other commodities being sold below their value.
The total values produced by society would still amount to the same.

Was there Surplus Value before 1928? Cliff’s Arbitrary Division

In this connection, Cliff is not at all consistent. Shachtman, in his endeavour
to deny that Russia is a transitional society in which capitalist laws continue
to operate, as well as the laws of the future society, at least argues consistently.
He says that the law of value does not operate, therefore all the laws flowing
from it do not operate. It is not surplus value which is produced, but surplus
product; it is not labour power that the workers sell, since they are slaves,
etc, etc. Cliff, however, admits that commodity production continues, labour
power and surplus value remain. But once these Marxian categories are accepted
as valid for Russian society, then clearly the law of value must operate internally,
or the whole position becomes nonsensical.

The whole contradiction, a contradiction within the society itself and not
imposed abitrarily - is in the very concept of the dictatorship of the proletariat.
If one considers the problem in the abstract, one can see that this is a contradictory
phenomenon: the abolition of capitalism yet the continuation of classes. The
proletariat does not disappear. It raises itself to the position of ruling class
and abolishes the capitalist class. But in the intervening period it remains
the working class. Therefore, surplus product in the form of surplus value is
produced. It is the case today as it was under Lenin and Trotsky. We have only
to pose the problem: what was the surplus value produced when Russia
was still a workers’ state - though even then with bureaucratic deformations?
What was the process by means of which surplus product before 1928 mysteriously
became surplus value after 1928? What was this curious unexplained process?
We would like to ask the question here: Did the existence of capitalism outside
Russia before 1928 have a similar effect on Russia’s economy? Of course it did.
In fact a far greater effect because of the weakness of the Russian economy.
Why was there not capitalism in Russia then?

Or further: leave aside the period from 1917 to 1923 - what was the situation
from 1923 to 1928 when the Stalinist bureaucracy was consolidating itself? There
were far more actual individual capitalist elements in the economy of the country
then than there are today. The pressure of world capitalism from an economic
point of view was indisputably far greater. Merely to pose the problem is to
show the arbitrary method.

The abuse of power and the legal and illegal consumption of surplus value by
the bureaucracy, necessarily took place even in the early stages of bureaucratic
control. Comrade Cliff has to construct a lifeless scheme which bears no relation
to reality in order to create a distinction between the two periods: the period
when the bureaucracy represented a degenerated workers’ state, and the period
when the bureaucracy became a capitalist class. What, according to Cliff, is
the difference? Incredible as it may seem, the bureaucracy really earned its
income and only from 1928 onwards did they consume surplus value. Cliff writes:

"The statistics we have at our disposal conclusively show that although
the bureaucracy had a privileged position in the period preceding the Five-Year
Plan, it can on no account be said that it received surplus value from the labour
of others. It can just as conclusively be said that with the introduction of
the Five-Year Plans, the bureaucracy’s income consisted to a large extent of
surplus value." (page 45)

This is at variance with the analysis made not only by Trotsky but by the other
Marxists of the time in relation to this problem. First of all, even in the
most ideal workers’ state, in the transitional period there will unavoidably
be a certain consumption of the surplus value by the specialists and bureaucrats.
Otherwise, we would have the immediate introduction of communism, without any
inequalities or the continuance of the division between mental and manual labour.
It is only necessary to refer here to the Left Opposition on this very problem.
As early as 1927, the Left Opposition commented on the enormous part of the
surplus value being consumed by the bureaucratic apparatus. They protested that
the ‘swollen and privileged administrative apparatus is devouring a very
considerable part of the surplus value’.
[source]
(See Revolution Betrayed, page 141)

It is clear that from 1920 onwards, the bureaucracy consumed a great part of
the surplus value, legitimately and illegitimately. As Marx explained in any
case, in a workers’ state in the transitional period, the surplus value will
be used for the speedy building up of industry and so prepare the way for the
quickest possible transition to equality and then complete communism.

What else was Lenin speaking of in 1920 and 1921 when he stressed the step
backward the Bolsheviks had been forced to make, when they paid the specialists
according to bourgeois standards and in the old ‘bourgeois way’?

The Economics of the Transition from Capitalism to Socialism

The most significant thing about all tendencies who seek to revise Trotsky’s
position on the Russian question is that they always deal with the problem in
the abstract and never concretely explain the laws of the transitional
society between capitalism and socialism and how such a society would operate.
This is not accidental. A concrete consideration would impel them to the conclusion
that the fundamental economy in Russia is the same as it was under Lenin
and that it could not be otherwise.

The germ of the capitalist mode of production, which began under feudalism
through the development of commodity production, lies in the function of the
independent craftsmen and merchants. When it reaches a certain stage we have
capitalist relations with a feudal superstructure. These are burst asunder
by the revolution and the possibilities latent in capitalist production then
have the free possibility of fruition unhampered by feudal restrictions.

The whole essence of the revolution (capitalist and proletarian) consists of
the fact that the old relationships and the old forms do not correspond with
the new ripened method or mode of production. In order to free itself from these
restrictions, the productive forces have to be organised on a different basis
and the whole of human history and movement of history consists in the development
of this antagonism at its various stages in different societies.

However, the bourgeois revolution does not immediately destroy feudalism at
one blow. Powerful feudal elements still remain, and to this day the remnants
of feudalism exist even in the most highly developed capitalist countries.

One can speak of the feudal mode of production in the sense of the superstructure,
despite the capitalist basis which has developed beneath. Or one can even speak
of the feudal mode of production at its inception where the germs of capitalism
and the possibility of the development of capitalism could be faintly discerned.

The fundamental error of this ‘state capitalist’ theory and its abstractions
relating to the transitional period, lies in the failure to distinguish between
the mode of production and the mode of appropriation. In every class society
there is exploitation and a surplus which is utilised by the exploiting class.
But in itself this tells us nothing about the mode of production.

For example, the mode of production under capitalism is social in contradiction
to the individual form of appropriation. As Engels explained:

"The separation between the means of production concentrated in the hands
of the capitalists on the one side, and the producers now possessing nothing
but their labour power, on the other, was made complete. The contradiction between
social production and capitalist [read individual or private, as Engels had
already explained - EG] appropriation became manifest as the antagonism between
proletariat and bourgeoisie." (Anti-Dühring, page 321)
[source]

The transitional economy which, as Lenin pointed out, can and will vary enormously
in different countries at different times, and even in the same country at different
times, also has a social mode of production, but with state appropriation,
and not individual appropriation as under capitalism. This is a form which
combines both socialist and capitalist features.

Under capitalism, the system of commodity production par excellence,
the product completely dominates the producer. This flows from the form
of appropriation, and the contradiction between the form of appropriation and
the mode of production; both factors flow from the private ownership of the
means of production. Once state ownership takes its place, whatever the
resulting system may be, it cannot be capitalism because this basic contradiction
will have been abolished. The anarchic character of social production with private
appropriation disappears.

Under socialism also, there will be a social mode of production but there
will also be a social mode of distribution. For the first time production
and distribution will be in harmony.

Therefore, merely to point out the capitalist features in Russia today (wage
labour, commodity production, that the bureaucracy consumes an enormous part
of the surplus value) is not sufficient to tell us the nature of the social
system. Here too, an all-sided view is necessary. One can only understand social
relationships in the Soviet Union by taking the totality of the relationships.
From the very beginning of the revolution various sectarian schools have produced
the most untenable ideas as a result of their failure to make such an analysis.
Lenin summed up the problem thus:

"But what does the word ‘transition’ mean? Does it mean, as applied to
economics, that the present order contains elements, particles, pieces of both
capitalism and socialism? Everyone will admit that it does. But not all who
admit this take the trouble to consider the precise nature of the elements that
constitute the various social-economic forms which exist in Russia at the present
time. And this is the crux of the question." (Left wing childishness
and the petty-bourgeois mentality, Collected Works, Volume 27, page 335)
[source]

To abstract one side must lead to error. What is puzzling about the Russian
phenomenon is precisely the contradictory character of the economy.
This has been further aggravated by the backwardness and isolation of the Soviet
Union. This culminates in the totalitarian Stalinist regime and results in the
worst features of capitalism coming to the fore - the relations between managers
and men, piece-work, etc. Instead of analysing these contradictions Comrade
Cliff endeavours as far as possible to try and fit them into the pattern of
the ‘normal’ laws of capitalist production.

In addition, the tendency under capitalism for the productive forces not only
to become centralised but even for measures of statification to be introduced
can result in a wrong conclusion. To prove that ‘state capitalism’ in Russia
is in the last analysis the same as individual capitalism with the same laws,
Cliff cites the following passage from Anti-Dühring:

"The more productive forces it [the state - TC] takes over, the more it
becomes the real collective body of all the capitalists, the more citizens it
exploits. The workers remain wage-earners, proletarians. The capitalist relationship
is not abolished; it is rather pushed to an extreme. But at this extreme it
changes into its opposite. State ownership of the productive forces is not the
solution of the conflict, but it contains within itself the formal means, the
key to the solution." (Anti-Dühring, page 330)
[source]

In point of fact, Engels is arguing precisely the opposite. Let us re-examine
the passages and see how we draw different conclusions:

"If the crisis revealed the incapacity of the bourgeoisie any longer
to control the modern productive forces, the conversion of the great organisations
for production and communication into joint-stock companies and state property
shows that for this purpose the bourgeoisie can he dispensed with. All the social
functions of the capitalists are now carried out by salaried employees. The
capitalist has no longer any social activity save the pocketing of revenues,
the clippng of coupons and gambling on the stock exchange, where the different
capitalists fleece each other of their capital. Just as at first the capitalist
mode of production displaced the workers, so now it displaces the capitalists,
relegating them, just as it did the workers, to the superfluous population,
even if in the first instance not to the industrial reserve army.

"But neither the conversion into joint-stock companies nor into state
property deprives the productive forces of their character as capital. In
the case of joint-stock companies this is obvious. And the modern state, too,
is only the organisation with which bourgeois society provides itself in order
to maintain the general external conditions of the capitalist mode of production
against encroachments either by the workers or by individual capitalists. The
modern state, whatever its form, is an essentially capitalist machine; it is
the state of the capitalists, the ideal collective body of all capitalists.
The more productive forces it takes over as its property, the more it becomes
the real collective body of all the capitalists, the more citizens it exploits.
The workers remain wage earners, proletarians. The capitalist relationship
is not abolished; it is rather pushed to an extreme. But at this extreme it
is transformed into its opposite. State ownership of the productive forces is
not the solution of the conflict, but it contains within itself the formal means,
the key to the solution." (Anti-Dühring, page 330, our emphasis)
[source]

Surely the idea in the foregoing is clear. Insofar as the forces of production
have now developed beyond the framework of capitalist relations (that is, the
germ of the contradiction has now grown into a malignant disease of the social
system, reflecting itself through the crises) the capitalists are compelled
to ‘socialise’ huge means of production - first, through joint-stock companies
and then later, even to ‘statify’ sections of the productive forces. This particular
idea was brought out sharply by Lenin in Imperialism, where he showed
that the development of monopolies and socialisation of labour were in fact
elements of the new social system within the old.

Once the productive forces had reached this stage, capitalism had already accomplished
its historic mission, and because of this the bourgeoisie becomes more and more
superfluous. From being a necessity for the development of the forces of production,
they now become ‘superfluous’, ‘parasites’, ‘coupon-clippers’. In this they
are transformed into parasites in the same way and for the same reason as the
feudal lords also became ‘parasites’ once their mission had been fulfilled.

This is merely an indication of the ripeness of capitalism for the social revolution.
Writing in Capital Marx had shown that credit and joint-stock companies
were already an indication that the productive forces had outgrown private ownership.
Engels had shown that the social productive forces even compel the capitalists
to recognise their character as social and not as individual productive
forces.

Wherever the capitalist state is constrained to take over this or that sector
of the economy, it is true the productive forces do not lose their character
as capital. But the whole essence of the problem is that where we have complete
statification, quantity changes into quality, capitalism changes into its opposite.

How otherwise explain the statement of Engels: ‘But at this extreme it
[the capitalist relationship] is transformed into its opposite. State
ownership of the productive forces is not the solution of the conflict, but
it contains within itself the formal means, the key to the solution’?

If one takes into account the fact that this follows the previously quoted
passage in the same section where Engels defines capitalist mode of production
(as social production, individual appropriation), we must conclude that Engels
hopelessly contradicts himself, if we accept Cliff’s conclusions. But from the
context, Engels’ meaning is clear. He explains that the solution to the contradictions
of capitalism lies in the recognition of the social nature of the modern productive
forces: ‘In bringing, therefore, the mode of production, appropriation and exchange
into accord with the social character of the means of production. ‘But he shows
that this ‘recognition’ precisely consists in asserting conscious organisation
and planning, in place of the blind play of forces of the market on the basis
of individual ownership. This, however, cannot be done at one stroke. Only ‘gradually’
can social control be fully asserted. The transitional form to this is state
ownership. But complete state ownership does not abolish all the features
of capitalism immediately, otherwise there would be social ownership, ie socialism
would he introduced immediately.

But in the same way as we have the new within the old system in the development
of society, so in the transitional society we still have the old within the
new. Complete statification marks the extreme limit of capital. The capitalist
relation is transformed into its opposite. The elements of the new society which
were growing up within the old, now become dominant.

What causes the conflict within capitalism is the fact that the laws manifest
themselves blindly. But once the whole of industry is nationalised, for the
first time control and planning can be consciously asserted by the producers.
Control and planning will, however, in the first stages, take place within given
limits. These limits will be determined by the level of technique when the new
social order takes over.

Society cannot step from the realm of necessity into the realm of freedom overnight.
Only on the basis of a limitless development of the productive forces will freedom,
in its fullest sense, become a reality. The stage will be reached which will
witness the ‘administration of things’.

Before such a stage is reached, society must pass through the transitional
period. But in so far as immediately after private ownership has been abolished,
control and planning become a possibility for the first time, then for the first
time also the realm of necessity is left behind. But while it is now possible
to speak of ‘freedom’, this is only so in the sense that necessity has become
consciously recognised. At this stage (the transitional period), Engels pointed
out:

"The social character of the means of production and of the products...is
quite consciously asserted by the producers, and is transformed from a cause
of disorder and periodic collapse into the most powerful level of production
itself.

"The forces operating in society work exactly like the forces operating
in nature; blindly, violently, destructively, so long as we do not understand
them and fail to take them into account. But when once we have recognised them
and understand how they work, their direction and their effects, the gradual
subjection of them to our will and the use of them for the attainment of
our aims depends entirely upon ourselves. And this is quite especially true
of the mighty productive forces of the present day." (Anti-Dühring,
page 331, our emphasis)
[source (translation differs)]

Engels, quoting Hegel, further summed up the relationships between freedom,
necessity and the transitional period, thus:

"Freedom is the realisation of necessity. ‘Necessity is blind only insofar
as it is not understood." (Anti-Dühring, page 136)
[source (translation differs)]

Marx and Engels only touched on the contradictory character of the transitional
period. They left its elaboration to succeeding generations, laying down only
the general laws. But clearly they showed the need for state ownership as
the necessary transitional state for the development of the productive forces.
Engels explained the need for the state during this stage for two reasons:

To take measures against the old ruling class.Because the transitional society cannot immediately guarantee enough for
all.

The logic of Cliff’s thesis is that in the transitional society there are no
vestiges of capitalism in the internal economy. While Comrade Cliff may argue
vehemently that he agrees with the need for the state in the transitional period,
it is evident that he has not thought out the economic reasons which make
the state necessary and what character the economy assumes in this period. Before
socialism can be introduced there must necessarily be a tremendous development
of the forces of production, far beyond those reached under capitalism.

As Trotsky explained, even in America there is still not enough production
to guarantee the immediate introduction of socialism. Therefore, there will
still have to be an intervening period in which capitalist laws will operate
in modified form. Of course, in America, this would be of short duration. But
it will not be possible to skip this stage entirely. What are the capitalist
laws which will remain? Comrade Cliff not only fails to answer this; he falls
into the trap of bureaucratic collectivism by failing to recognise that money,
labour power, the existence of the working class, surplus value, etc, are
all survivals of the old capitalist system which were carried over even
under the regime of Lenin. It is impossible to introduce immediately direct
social production and distribution. Particularly was this the case in backward
Russia.

Writing to Conrad Schmidt in 1890, Engels gave a magnificent example of the
thoroughly materialist approach to the problem of the economics of the transition
from capitalism to socialism. He wrote:

"There has been a discussion in the Volkstribune about the division
of products in the future society, whether this will take place according to
the amount of work done or otherwise. The question has been approached very
‘materialistically’, in opposition to certain idealistic forms of phraseology
about justice. But strangely enough it has never struck anyone that, after all,
the method of division essentially depends on how much there is to divide,
and this must surely change with progress of production and social organisation,
so that the method of division may also change. But to everyone who took part
in the discussion ‘socialist society’ appeared not as involved in continuous
change and progress but as a stable affair fixed once and for all which must,
therefore, have its method of division fixed once and for all. All one can reasonably
do, however, is (1) to try and discover the method of division to be used at
the beginning, and (2) to try and find the general tendency in which
the further development will proceed. But about this I do not find a single
word in the whole debate." (Marx, Engels, Selected Correspondence, Progress,
Moscow, 1975, page 393)[source]

Writing in Anti-Dühring, Engels pointed out:

"Direct social production and direct distribution exclude all exchange
of commodities, therefore also the transformation of the product into commodities
(at any rate within the community) and consequently also their transformation
into values." (Anti-Dühring, page 366, our emphasis)
[source]

But only socialism could realise this. In the transitional period, distribution
still remains indirect - only gradually does society gain complete control over
the product - and therefore the production of commodities and of exchange between
the different sectors of production must necessarily take place. The law of
value applies and must apply until there is direct access to the product
by the producers. This can only take place on the basis of complete control
of social production and thus direct social distribution, namely, each individual
taking whatever he requires. Marx deals with this problem in passing in Volume
III of Capital (Chapter 49), where he is discussing the problem of capitalist
production as a whole:

"Accordingly a portion of the profit, of surplus value and of the surplus
product, in which only newly added labour is represented, so far as its value
is concerned, serves as an insurance fund...This is also the only portion
of the surplus-value and surplus product and thus of surplus-labour, which would
continue to exist, outside of that portion which serves for accumulation and
for expansion of the process of reproduction, even after the abolition of
the capitalist system...and the fact that all new capital arises out
of profit, rent, or other forms of revenue, that is, out of surplus labour..."
(Capital, Volume III, Progress, Moscow, 1971, page 847-8, our emphasis)
[source]

In this chapter Marx is dealing, in an analysis of the process of production,
in his own words, with ‘the value of the total annual product of labour (which)
is under discussion, in other words, the value of the product of the total social
capital.’

Repeating this in the same chapter, in answer to Storch, one of the bourgeois
economists, he declared:

"In the first place, it is a false abstraction to regard a nation, whose
mode of production is based upon value or otherwise capitalistically organised,
as an aggregate body working merely for the satisfaction of the national
wants.

"In the second place, after the abolition of the capitalist mode of production,
but with social production still in vogue, the detemination of value
continues to prevail in such a way that the regulation of the labour time and
the distribution of the social labour among the various groups of production
also the keeping of accounts in connection with this, becomes more
essential than ever." (Capital, Volume III, page 851, our emphasis)
[source]

This is in line with the scattered remarks of Marx and Engels at various times
in dealing with the transitional period: where Engels explains that under capitalism
joint-stock companies and state ownership are beyond the framework, properly
speaking, of capitalist production; where Marx already pointed out that credit
also extended production beyond its framework even before the transition
to the dictatorship of the proletariat. After that, as shown in the above
passages and also in the Critique of the Gotha Programme, Marx considered
that bourgeois law, bourgeois distribution and in that sense a bourgeois state
still remain.

Discussing the role of money and the state in the transitional period, Trotsky
developed this idea even further:

"...These two problems, state and money, have a number of traits
in common, for they both reduce themselves in the last analysis to the problem
of problems: productivity of labour. State compulsion like money compulsion
is an inheritance from the class society, which is incapable of defining the
relations of man to man except in the form of fetishes, churchly or secular,
after appointing to defend them the most alarming of all fetishes, the state,
with a great knife between its teeth. In a communist society, the state and
money will disappear. Their gradual dying away ought consequently to begin under
socialism only at that historical moment when the state turns into a semi-state,
and money begins to lose its magic power. This will mean that socialism, having
freed itself from capitalist fetishes, is beginning to create a more lucid,
free and worthy relation among men. Such characteristically anarchist demands
as the ‘abolition’ of money, ‘abolition’ of wages, or ‘liquidation’ of the state
and family possess interest merely as models of mechanical thinking. Money cannot
be arbitrarily ‘abolished’, nor the state and the old family ‘liquidated’. They
have to exhaust their historic mission, evaporate, and fall away. The death-blow
to money fetishism will be struck only upon that stage when the steady growth
of social wealth has made us bipeds forget our miserly attitude toward every
excess minute of labour, and our humiliating fear about the size of our ration.
Having lost its ability to bring happiness or trample men in the dust, money
will turn into mere book-keeping receipts for the conveniences of statisticians
and for planning purposes. In the still more distant future, probably these
receipts will not be needed. But we can leave this question entirely to posterity,
who will be more intelligent than we are.

"The nationalisation of the means of production and credit, the co-operativising
or state-ising of internal trade, the monopoly of foreign trade, the collectivisation
of agriculture, the law on inheritance - set strict limits upon the personal
accumulation of money and hinder its conversion into private capital (usurious,
commercial and industrial). These functions of money, however, bound up as they
are with exploitation, are not liquidated at the beginning of a proletarian
revolution, but in a modified form are transferred to the state, the universal
merchant, creditor and industrialist. At the same time the more elementary functions
of money, as measure of value, means of exchange and medium
of payment, are not only preserved, but acquire a broader field of action
than they had under capitalism." (Revolution Betrayed, page
65-6, emphasis in original)[source]

To sum up. Whereas before private ownership of the means of production is abolished,
the market is dominant over man who is helpless before the laws of the economy
he himself has created, after its abolition, he begins for the first time to
consciously assert control. But consciousness here merely means the recognition
of law, not the abolition of law. That is the peculiarity of the transitional
period, that because man now understands the nature of the productive forces,
to that extent he can exercise control over them. But he cannot transcend the
limits of the given development of the productive forces. However, now that
the productive forces have been released from the fetters of individual capitalist
production, they can be developed at such a pace and with such expansion that
very rapidly they can be transformed from state ownership as an intermediate
form, into social ownership by society. Once this stage has been reached (socialism),
there is real social production and distribution for the first time. Money withers
away, the law of value withers away, the state withers away. In other words,
all the forces of constraint which are a necessary reflection of the limits
of technique and the development of production at any given stage, now disappear
with the disappearance of the division of labour. Until such time, all the features
referred to above, capitalist features carried over from the old capitalist
society, will linger on in the transitional period.

The position of Comrade Cliff, as with Shachtman and all others who have revised
Trotsky’s position on Russia, remains, on the transitional period, a blank.
And for a very good reason. If one considers the theory of the transitional
stage in the light of the Russian experience, there are only one of two conclusions:
either Russia today is still in a transitional stage, which has taken on horrible
distortions, or Russia was never a workers’ state from the very beginning. There
are no other alternatives.

The Marxian Theory of the State. Two Classes One State - Cliff’s Contradiction

In the first chapter of his work, Comrade Cliff endeavours to prove that Trotsky’s
analysis of the Russian state contradicts the theory of the state as developed
by Marx and elaborated by Lenin.

The first chapter contains an elaborate scheme which sets out to prove that
two classes cannot use one state machine. Here Cliff believes he has found a
fundamental error in Trotsky. Taking the ideas developed by the Old Man at different
times and in differing circumstances, he counterposes them to each other. He
counterposes, for example, a quotation from Trotsky in the early stages of the
degeneration of the bureaucracy and the expulsion of the Left Opposition, when
he argued for the reform of the soviet state, and incidentally, also for the
reform of the Bolshevik Party which controlled the state. (It was at this stage
that Trotsky wrote the letter to the CC of the CPSU demanding that Stalin be
removed.) Who can deny that had the international events developed differently
it was theoretically possible that the Bolshevik Party could have spewed forth
the bureaucracy and re-established a healthy workers’ state?

Cliff counterposes to this the quotation from Revolution Betrayed, in
which Trotsky says that if the Russian workers come to power they will purge
the state apparatus; and if the bourgeoisie come to power ‘a purgation
of the state apparatus would, of course, be necessary in this case too. But
a bourgeois restoration would probably have to clean fewer people than a revolutionary
party’. Cliff’s answer to this is:

"Whether we assume that the proletariat must smash the existing state
machine on coming to power while the bourgeoisie can use it, or whether we assume
that neither the proletariat nor the bourgeoisie can use the existing state
apparatus (the ‘purgation of the state apparatus’ necessarily involving such
a deep change as would transform quantity into quality) - on both assumptions
we must come to the conclusion that Russia is not a workers’ state. To
assume that the proletariat and the bourgeoisie can use the same state machine
as the instrument of their supremacy is tantamount to a vindication of the theoretical
basis of social democracy and a repudiation of the revolutionary concept of
the state expressed by Marx, Engels, Lenin and Trotsky. To assume that different
layers, groups or parties of one and the same class cannot base themselves on
the same state machine is equally a repudiation of the Marxist concept of the
state." (Cliff, page 4)

This whole formalistic method is the fatal weakness of Cliff’s case. It would
have been impossible for Trotsky in the early stages to deal with the problem
in the abstract. He had to deal with the concrete situation and give a concrete
answer. But the further degeneration posed the problem in an entirely different
way. Once it had been established that it was impossible to reform the Stalinist
party, that it was impossible to reform the Soviet state (we assume that Cliff
also believes this was the task since up to 1928 since he says Russia was
a degenerated workers’ state), then the question had to be viewed in a somewhat
different light. It is foreign to the Marxist method to search for isolated
contradictions, real or apparent. What is required is an examination of a theory
in its broad general development, in its movement, and its contradictions.

But let us examine Cliff’s own thought processes on this subject. He too cannot
avoid the very trap which he tries to lay for Trotsky. Chapter 1 (no less than
eighteen pages) is devoted to proving the impossibility of two classes using
the one state. But lo and behold, Chapter 4 accomplishes the miracle! The
impossible gulf is bridged! Both the capitalist class and the proletariat
of Russia have used precisely the same state machine. Why? Because more
surplus value was produced! Realising this dilemma, Cliff is compelled to advance
something truly new and unique in the movement: that the bureaucracy did not
consume surplus value before 1928 but by the introduction of the Five Year
Plan, the state was changed from a workers’ state into a capitalist state.
(Any enemy of the Fourth International could immediately retort that the
state of Stalin on this basis is purely an extension and deepening of the state
of Lenin. For in the economic sense nothing fundamentally was changed. We have
dealt with this in preceding chapters. Significantly it is only on the economic
argument - and this is astonishing - that Cliff advances his theory. Despite
the title of his first Chapter ‘An Examination of the Definition of Russia as
a Degenerated Workers’ State’, he does not deal with the political question
at all here or in any other chapter. Here is how Cliff sees the transformation
from a workers’ state into a capitalist state:

"The statistics we have at our disposal conclusively show that although
the bureaucracy had a privileged position in the period preceding the Five-Year
Plan, it can on no account be said that it received surplus value from the labour
of others. It can just as conclusively be said that with the introduction of
the Five-Year Plans, the bureaucracy’s income consisted to a large extent of
surplus value." (Cliff, page 45)

In other words, Cliff sees the transition from one system to the other not
by smashing of the state machine. How does this fit into his scheme in Chapter
1?

Cliff’s attempt to manufacture an artificial bridge between the workers’ state
and the capitalist state, because he has not been able to find the smashing
of the workers’ state machine, has led him to seek economic differences between
the two periods - pre-1928 and post-1928. In this he falls into the most formalistic
and abstract conceptions of the workers’ state prior to 1928. As we have shown
in the previous chapters, even in the healthiest of workers’ states, according
to Marx, surplus value must necessarily be produced in order to develop industry
to the point where the state, money, and the proletariat itself and all the
other survivals of capitalism will have disappeared. So long as the working
class exists as a class, surplus value will be produced.

A statement of the Left Opposition in 1927 pointed out that the bureaucracy
was consuming an enormous part of the surplus value. Cliff’s method of
introducing this subject is totally incorrect. Instead of setting himself the
task of proving a thesis, he blandly makes assertions and takes them as proven.
That Chapter 4 contradicts everything in Chapter 1 is another matter! Just examine
the way in which Comrade Cliff sums up this Chapter 4, in which he openly claims
that a transition has been achieved without a revolution and without smashing
the state machine.

He begins:

"In this chapter we shall describe the transformation of the class character
of the Russian state from a workers’ to a capitalist state. We shall do this
by dealing with the following points..." (Cliff, page 33)

He thereupon proceeds to detail a number of economic changes which have
nothing to do with the structure of or the transformation of state power,
and ends up with the subsection: ‘Why the Five Year Plan Signifies the Transformation
of the Bureaucracy into a Ruling Class.’ All the economic arguments in this
chapter have nothing to do with the state or its overthrow.

Cliff deals at length with the differentiation in the army, the introduction
of privileges for the officers, military discipline, etc. He here merely repeats
what Trotsky said a thousand times on the transformation of the bureaucracy
into an uncontrolled caste. But let us see his conclusions. He writes:

"Again the Five-Year Plan marks the turning point. Then the organisation
and the structure of the army began to change fundamentally. From a workers’army
with bureaucratic deformations it became the armed body of the bureaucracy as
the ruling class..." (page 59)

Let us see now whether what excludes a gradual social revolution excludes a
gradual counter-revolution.

"If the soldiers in an hierarchically built army strive for decisive control
over the army, they immediately meet with the opposition of the officer caste.
There is no way of removing such a caste except by revolutionary violence. As
against this, if the officers of a people’s militia become less and less dependent
on the will of the soldiers, which they may do as they meet with no institutional
bureaucracy, their transformation into an officers’ caste independent of the
soldiers can be accomplished gradually. The transition from a standing army
to a militia cannot but be accompanied by a tremendous outbreak of revolutionary
violence: on the other hand, the transition from a militia to a standing army,
to the extent that it is the result of the tendencies inside the militia itself,
can and must be gradual. The opposition of the soldiers to the rising bureaucracy
may lead the latter to use violence against the soldiers. But this does not
exclude the possibility of a gradual transition from a militia to a standing
army. What applies to the army applies equally to the state. A state without
a bureaucracy, or with a weak bureaucracy dependent on the pressure of the masses
may gradually be transformed into a state in which the bureaucracy is free of
workers’ control." (Cliff, page 82, our emphasis)

Cliff now sets out to prove that there can be a gradual transition from a workers’
state to a capitalist state, and clinches his chapter by producing a quotation
from none other than Trotsky...whom he has so sternly discredited as an authority
on this subject in his Chapter 1.

Cliff writes:

"The Moscow Trials(5)
were the civil war of the bureaucracy
against the masses, a war in which only one side was armed and organised. They
witnessed the consummation of the bureaucracy’s total liberation from popular
control. Trotsky, who thought that the Moscow trials and the ‘Constitution’
were steps towards the restoration of individual capitalism by legal means,
then withdrew the argument that a gradual change from a proletarian to a bourgeois
state is ‘running backwards the film of reformism’. He wrote:

"’In reality, the new constitution...opens up for the bureaucracy
"legal" roads for the economic counter-revolution, ie, the restoration
of capitalism by means of a "Cold stroke".’ (Fourth International
and the Soviet Union, Thesis adopted by the First International Conference
for the Fourth International, Geneva, July 1936.)" (Cliff, page 82)

Here we see the full light on Cliff’s thesis and his bad method. Starting off
with the thesis that Trotsky is no Marxist because he says two classes can use
one state machine, Cliff ends up saying precisely the same thing and using as
his authority the same Trotsky.

Nationalisation and the Workers’ State

On page 2 of his work, Cliff gives a quotation from Revolution Betrayed:

"The nationalisation of the land, the means of industrial production,
transport and exchange, together with the monopoly of foreign trade, constitutes
the basis of the Soviet social structure. Through these relations, established
by the proletarian revolution, the nature of the Soviet Union as a proletarian
state is for us basically defined." (Revolution Betrayed, page 248)
[source]

One of Cliff’s conclusions is that, in this case, ‘neither the Paris Commune
nor the Bolshevik dictatorship were workers’ states as the former did not statify
the means of production at all, and the latter did not do so for some time.’
Here we see that Cliff bases his case on whether or not the working class has
control over the state machine. We will deal with the question of workers’ control
in a later chapter. But here let us examine Cliff’s method of separating the
economic basis of a workers’ state from the question of workers’ control of
the state machine. For a temporary period, for shorter or longer duration, it
would be possible for the proletariat to take power politically while not proceeding
economically to transform society. This was the position in Russia where the
proletariat took power in October 1917, but did not undertake major nationalisation
until it was forced upon them in 1918. But if the proletariat did not proceed
to carry through the economic transformation, then inevitably the proletarian
regime would be doomed to collapse. The laws of the economy will always break
through in the end. Either the proletariat would proceed to nationalise the
entire economy, or inevitably the capitalist system would emerge predominant.
Cliff fails to show how the basic forms of Russian economy would differ under
a healthy workers’ state. He has taken refuge in the surplus value consumed
by the bureaucracy, but this evades the fundamental issue.

No better is Cliff’s case based upon the experience of the Paris Commune and
the first stage of the Russian Revolution. The same would apply to them as aforementioned.
These regimes were a transition to the complete economic rule of the
proletariat. Such transitions are more or less inevitable in the change over
from one society to another. Both in the case of the Commune and in the case
of the Russian Revolution, they could not be long lasting if the proletariat
did not proceed to nationalise industry. Has Cliff forgotten that one of the
main lessons taught by Marx and assiduously learned by the Bolsheviks, was the
failure of the French proletariat to nationalise the Bank of France? So we see
a state can be a proletarian state on the basis of political power, or it can
be a proletarian state on the basis of the economy; or it can be a transition
to both of these as we will show.

The same laws would apply to the counter-revolution on the part of the bourgeoisie.
The Old Man correctly argued that in the event of a bourgeois counter-revolution
in Russia, the bourgeoisie might, for a time, even retain state ownership before
breaking it up and handing it to private ownership. To a scholar it would appear
then that you can have a workers’ state and a bourgeois state on the basis of
state ownership, or you can have a workers’ state or a bourgeois state on the
basis of private ownership.

However, it is obvious that one could only arrive at this mode of reasoning
if one failed to take into consideration the movement of society in one
direction or another.

Not only that, but all sorts of unforeseen relationships can develop because
of the class structure of society and the state. To take the example of Russia.
In 1917 up to the capture of control of the soviets by the Bolsheviks, we had
the situation as sketched by Trotsky in the History of the Russian Revolution,
where, because of the Menshevik majority, in a certain sense the bourgeoisie
ruled through the soviets - the organs of workers’ rule par excellence!According to Cliff’s schema, how could this possibly happen? Of course,
had the Bolsheviks not taken power, the bourgeoisie, having used the Mensheviks
and through them, the soviets in the transitional period, would have abolished
the soviets as they did in Germany after 1918.

In the transition from one society to another, it is clear that there is not
an unbridgeable gulf. It is not a dialectical method to think in finished categories;
workers’ state or capitalist state and the devil take any transition or motion
between the two. It is clear that when Marx spoke of the smashing of the old
state form in relation to the Commune, he took it for granted that the economy
would be transformed at a greater or lesser pace and would come into consonance
with the political forms. We will see later in relation to Eastern Europe that
Cliff adopts the same formalistic method.

The Dialectical Conception of the State

It may be well to deal here with the nature of the state. According to Marxists,
the state arises as the necessary instrument for the oppression of one class
by another class. The state in the last analysis, as explained by Marx and Lenin,
consists of armed bodies of men and their appendages. That is the essence of
the Marxist definition. However, one must be careful in using their broad Marxist
generalisations, which are undoubtedly correct, in an absolute sense. Truth
is always concrete but if one does not analyse the particular ramifications
and concrete circumstances, one must inevitably fall into abstractions and errors.
Look at the cautious way in which Engels deals with the question, even when
generalising. In Origins of the Family, Engels wrote:

"But in order that these antagonisms, classes with conflicting economic
interests, shall not consume themselves and society in fruitless struggle, a
power, apparently standing above society, has become necessary to moderate the
conflict and keep it within the bounds of ‘order’, and this power, arisen out
of society, but placing itself above it and increasingly alienating itself from
it, is the state." (The Origin of the Family, Lawrence & Wishart,
London, 1946, page 194)
[source]

On the next page he goes on to show that:

"...it is enough to look at Europe today, where class struggle and
rivalry in conquest have brought the public power to a pitch where it threatens
to devour the whole of society and even the state itself."

Engels goes on to show that once having arisen, the state within certain
limits, develops an independent movement of its own and must necessarily
do so under given conditions: "In possession of the public power and the right
of taxation, the officials now present themselves as organs of society standing
above society." (Emphasis in original)
[source]

Contrary to Cliff’s conception that the state plays a direct role, one can
see the meticulous care with which Engels treats the question of the independent
role of the state, relative of course, to society. In the whole of Cliff’s
material, the fact that the state under given conditions can and does play a
relatively independent role in the struggle between the classes is forgotten.
His is a ‘logical’ scheme: either it is a state of workers, directly controlled
by the workers, or it must be a capitalist state. There is no room for the interplay
of forces in Cliff’s method. Again, contrast this with Engels:

"As the state arose from the need to keep class antagonisms in check,
but also arose in the thick of the fight between the classes, it is normally
the state of the most powerful, economically ruling class, which by its means
becomes also the political ruling class, and so acquires new means of holding
down and exploiting the oppressed class...Exceptional periods, however, occur
when the warring classes are so nearly equal in forces that the state power,
as apparent mediator, acquires for the moment a certain independence in relation
to both..." (page 196, our emphasis)
[source]

Again, on page 201, Engels wrote:

"The central link in civilised society is the state, which in all typical
periods (our emphasis) is without exception the state of the ruling class,
and in all cases continues to be essentially a machine for holding down the
oppressed, exploited class..."
[source]

Note the difference between Cliff’s black and white formulae and Engels’ careful
formulations...’it is normally’, in ‘typical periods’, etc.

Why is it that the proletariat cannot take over the ready made state machine?
Not for mystical reasons but because of certain very concrete facts. In the
modern state all the key positions are in the hands of those people who are
under the control of the ruling class: they have been specially selected by
education, outlook, and conditions of life, to serve the interests of the bourgeoisie.
The army officers, particularly the higher ranks, the civil servants, and in
the nationalised industries today the key technicians, are moulded in their
ideas and outlook to serve the interests of the capitalist class. All the commanding
positions in society are placed in the hands of people whom the bourgeoisie
can trust. That is the reason the state machine is a tool in the hands of the
bourgeoisie which cannot be used by the proletariat and must be smashed by them.
Now, what does the smashing of the state machine mean? To say the least, Cliff’s
ideas on this question appear to be very nebulous.

It is possible that many, perhaps even the majority of the officials of the
bourgeois state, will be used by the proletariat once they take power. But they
will be subordinate to the workers’ committees and organisations. For example
in the Soviet Union, in the early days after the Czarist army had been dissolved,
the Red Army was led by ex-Czarist officers. Likewise in the state apparatus
where a proportion of the officials were the same ex-Czarist officials. Because
of unfavourable historical factors this was later to play an important role
in the degeneration of the Russian regime. Not for nothing did Lenin say that
the Soviet state is ‘a bourgeois Czarist machine...barely varnished with
socialism’. (Incidentally this honest characterisation is very far from the
idealised and false picture of the state under Lenin and Trotsky which is drawn
by Cliff. How the process of degeneration could have taken place with the idyllic
picture painted by Cliff would be difficult to understand. However, this will
be dealt with in the later sections.)

The proletariat, according to the classical concept, smashes the old state
machine and proceeds to create a semi-state. Nevertheless, it is forced
to utilise the old technicians. But the state, even under the best conditions,
say in an advanced country with an educated proletariat, remains a bourgeois
instrument, and because of this the possibility of degeneration is implicit
in it. For that reason Marxists insist on the control of the masses, to ensure
that the state should not be allowed to develop into an independent force. As
speedily as possible, it should be dissolved into society.

It is for the very reasons given above that, under certain conditions, the
state gains a certain independence from the base which it originally represented.
Engels explained that though the superstructure is dependent on the economic
base, it nevertheless has an independent movement of its own. For quite a lengthy
period, there can be a conflict between the state and the class which that
state represents. That is why Engels speaks of the state ‘normally’ or in
‘typical periods’ directly representing the ruling class. The great Marxist
teachers have analysed the phenomenon of Bonapartism to which Engels refers
above. In the Eighteenth Brumaire Marx pointed out how the drunken soldiery
of Louis Napoleon, in the name of ‘the law, order and the family’, shot down
the bourgeoisie whom they presumably represented.[source]

Thus, one can only understand class society if one takes into account the many-sided
dialectical inter-dependence and antagonisms of all the factors within it. Formalists
usually get lost in one or other side of the problem. For example, Cliff can
write:

"...It needs just as high a degree of mental acrobatics to think that
Mikolajcik(6) and his ilk who flee abroad or waste away
in prisons are the rulers of Poland as to consider that the rulers of Russia
are the slave labourers in Siberia." (Cliff, page 13)

Were the bourgeoisie under Louis Napoleon the ruling class? It needs no high
degree of mental acrobatics to answer this.

When considering the development of society, economics must be considered
the dominant factor. The super-structure which develops on this economic
base separates itself from the base and becomes antagonistic to it. After all,
the essence of the Marxist theory of revolution is that with the gradual changes
in production under the embryo of the old form, ie, super-structure in both
property and state, a contradiction develops which can only be resolved by abolishing
the super-structure and re-organising society on the base of the new mode of
production which has developed within the old.

Economy in the long run is decisive. Because of this, as all the Marxist teachers
were at pains to explain, in the long run the superstructure must come into
correspondence with it. Once having abandoned the criterion of the basic economic
structure of society, all sorts of superficial and arbitrary constructions are
possible. One would inevitably be lost in the maze of history, like Perseus
in the mythology of ancient Greece who was lost in the Palace of mines, but
without a thread to lead one out. The thread of history is the basic economic
structure of society, or the property form, its legal reflection.

Let us take as a case extremely rich in examples, the history of France. The
bourgeois revolution took place in 1789. In 1793 the Jacobins(7)
seized complete power. As Marx and Engels pointed out, they went beyond the
framework of bourgeois relations and performed a salutary historical task because
of that, accomplishing in a few months what would have taken the bourgeoisie
decades or generations to accomplish; the complete cleansing from France of
all traces of feudalism. Yet this regime remained rooted in the basis of bourgeois
forms of property. It was followed by the French Thermidor and the rule of the
Directory, to be followed by the classic dictatorship of Napoleon Bonaparte.
Napoleon re-introduced many feudal forms, had himself crowned Emperor and concentrated
the supreme power in his hands. But we still call this regime bourgeois. With
the restoration of Louis XVIII the regime still remained capitalist...and
then we had not one but two revolutions - 1830 and 1848. These revolutions
had important social consequences. They resulted in significant changes even
in the personnel of the state itself. Yet we characterise them both as bourgeois
revolutions in which there was no change in the class which held power.

Let us proceed further. After the Paris Commune of 1871 and the shake-up of
the relations which this involved, we had the organisation of the Third Republic
with bourgeois democracy which lasted for decades. This was followed by Petain,
then the De Gaulle-Stalinist regime(8), and now the Quielle
Government. Examine for a moment the amazing diversity of these regimes. To
a non-Marxist it would seem absurd to define in the same category, shall we
say, the regime of Robespierre and that of Petain. Yet Marxists do define them
as fundamentally the same - bourgeois regimes. What is the criterion? Only the
one thing: the form of property, the private ownership of the means of production.

Take, similarly, the diversity of regimes in more modern times to see the extreme
differences in super-structures which are on the same economic base. For instance,
compare the regime of nazi Germany with that of British social democracy. They
are so fundamentally different in super-structure that many theorists of the
non-Marxist or ex-Marxist school have found new class structure and a new system
of society entirely. Why do we say that they represent the same class and the
same regime? Despite the difference in super-structure, the economic base
of the given societies remained the same.

If we take the history of modern society, we get many examples where the bourgeoisie
is expropriated politically and yet remains the ruling class. Trotsky
describes the regime of Bonapartism, or as Marx calls it, ‘naked rule by the
sword over society’.

Look what happened in China after Chiang Kai Shek had, with the dregs of the
Shanghai gangs, crushed the Shanghai working class. The bankers wished to give
him banquets and applaud him as the benefactor and saviour of civilisation.

But Chiang wanted something more material than the praise of his masters. Unceremoniously,
he clapped all the rich industrialists and bankers of Shanghai in jail and extracted
a ransom of millions before he would release them. He had done the job for them
and now demanded the price. He had not crushed the Shanghai workers for the
benefit of the capitalists, but for what it meant in power and income for him
and his gang of thugs. Yet who will presume to say that the bankers who were
in jail were not still the ruling class though they did not hold political power?
The Chinese bourgeoisie (no Marxists!) must have reflected sadly on the complexity
of society where a good portion of the loot in the surplus value extracted from
the workers had to go to their own watchdogs, and where many of their class
were languishing in jail.

The bourgeoisie is politically expropriated under such conditions; naked force
dominates society. An enormous part of the surplus value is consumed by the
top militarists and bureaucrats. But it is in the interests of these bureaucrats
that the capitalist exploitation of the workers should continue, and therefore
while they squeeze as much as they can out of the bourgeoisie, nevertheless,
they defend private property. That is why the bourgeoisie continues to be the
ruling class.

Here lies the anwer to those who assert that it is sheer sophistry to claim
that a working class can be a ruling class when a great proportion of them are
in jail in Siberia. Unless we are guided by the basic property forms of society
we will lose the Marxist road. Many examples could be given in history of the
way in which one section of the ruling class has attacked other sections. For
example, in the Wars of the Roses in Britain the two factions of the ruling
barons virtually exterminated one another. At one time or another in history
big sections of the ruling class were either in jails or were executed. One
has only to consider Hitler’s treatment of his bourgeois opponents. They lost
not only their property but their lives as well.

In dealing with the role of the state, the most important question that must
be answered and one which Cliff cannot answer is: the state must be an instrument
of a class - which class does it represent in Russia and Eastern Europe? It
cannot represent the capitalist class because they have been expropriated. It
cannot be argued that it represents the interests of the peasant class, or the
petty-owners in the cities. Under a fascist or Bonapartist regime, even though
the gangsters might have the bourgeoisie by the throat, nevertheless there is
a capitalist class in whose interests the economy operates as a whole, and on
whom this parasitic excrescence clings. If they do not represent the proletariat,
as Trotsky said, as a special form of Bonapartism in the sense that they defend
the nationalisation of the means of production, planning and the monopoly of
foreign trade, whom do the Stalinist bureaucrats represent? Cliff’s answer is
that the bureaucracy constitutes the new ruling class, the capitalist class
of Russia. But serious consideration of this would show that this cannot be
the case. What he is saying is that the state is a class. The bureaucracy
owns the state, the state owns the means of production, therefore the bureaucracy
is a class. This is dodging the issue, he is saying in effect that the state
owns the state.

According to Lenin, the state:

"...has always been a certain apparatus which separated out from society
and consisted of a group of people engaged solely, or almost solely, or mainly,
in ruling. People are divided into ruled and into specialists in ruling, those
who rise above society and are called rulers, representatives of the state.

"This apparatus, this group of people who rule others, always takes command
of a certain apparatus of coercion, of physical force, irrespective of whether
this coercion of people is expressed in the primitive club or - in the epoch
of slavery - in more perfected types of weapons, or in the firearms which appeared
in the middle ages or, finally, in modern weapons which, in the twentieth century,
are marvels of technique and are entirely based on the latest achievements of
modern technology.

"The methods of coercion changed, but whenever there was a state there
existed in every society a group of persons who ruled, who commanded, who dominated
and who, in order to maintain their power, possessed an apparatus of physical
coercion, an apparatus of violence, with those weapons which corresponded best
to the technical level of the given epoch. And by examining these general phenomena,
by asking ourselves why no state existed when there were no classes, when there
were no exploiters and no exploited, and why it arose when classes arose - only
in this way shall we find a definite answer to the question of the essence of
the state and its significance.

"The state is a machine for maintaining the rule of one class over another."
(The State, Collected Works, Volume 29, page 477)
[source]

The state by its very nature is composed of bureaucracy, officers, generals,
heads of police etc. But these do not constitute a class; they are the
instrument of a class even if they may be in antagonism to that class. They
cannot themselves be a class.

We must ask Cliff: Which section of the bureaucracy owns the state? It cannot
be all the bureaucrats, because they, the bureaucracy itself, are hierarchically
divided. The little civil servant is part of the bureaucracy as much as the
big bureaucrat. Is it then the commanding stratum in Soviet society? This is
clearly unsound. In capitalist society, or in any class society, no matter how
privileged the top, they wield the instrument to protect the ruling class which
has a direct relationship to the means of production, ie, in the sense of their
ownership. We know who Napoleon represented. We know who Louis Napoleon, Bismarck,
Chiang Kai Shek, Hitler, Churchill and Attlee represented. But who do the bureaucrats
represent: the bureaucrats? Clearly this is false. In another section we have
shown that the relationship of the bureaucracy to the means of production is
necessarily one of parasitism and partakes of the same parasitism as
the nazi bureaucracy. They are not a necessary and inevitable category for the
particular mode of production. At best they are entitled to wages of
superintendence. If they take more, it is in the same way as the nazi bureaucracy
consumed part of the surplus value produced by the workers. But they were not
a class.

Innumerable references could be given to show that a capitalist state presupposes
private property, individual ownership of the means of production. The state
is the apparatus of rule: it cannot itself be the class which rules.
The bureaucracy is merely part of the apparatus of the state. It may ‘own’ the
state, in the sense that it lifts itself above society and becomes relatively
independent of the economically dominant, ie, ruling class. That was the case
in nazi Germany, where the bureaucracy dictated to the capitalists what they
should produce, how they should produce it, etc, for the purposes of war. So
in the war economy of Britain, USA and elsewhere, the state dictated to the
capitalists what and how they should produce. This did not convert them into
a ruling class. Why? Because it was in defence of private property.

Cliff argues that the bureaucracy manages and plans industry. True enough.
Whose industry do they manage and plan? In capitalist society, the managers
plan and manage industry in the individual enterprises and trusts. But it does
not make them the owners of those enterprises and trusts. The bureaucracy manages
the entire industry. In that sense it is true that it has more independence
from its economic base than any other bureaucracy or state machine in the whole
of human history. But as Engels emphasised and we must re-emphasise, in the
final analysis the economic basis is decisive. If Cliff is going to argue that
it is in their function as managers that the bureaucrats are the ruling class,
then clearly he is not giving a Marxist definition of a capitalist class. He
is calling the Russian bureaucracy a class, but he must work out a theory as
to what class this is.

The state is the instrument of class rule, of coercion, a glorified policeman.
But the policeman is not the ruling class. The police can become unbridled,
can become bandits, but that does not convert them into a capitalist, feudal
or slave-owning class.

What Happened in Eastern Europe

Events in Eastern Europe and the nature of the states which have arisen can
only be explained by the Marxist-Leninist theory of the state, and only Trotsky’s
conceptions can explain events in Eastern Europe from this point of view.

First it is necessary to understand what took place in Eastern Europe with
the advance of the Red Army. No one can deny (leaving aside the question of
Germany for a moment) that in all the Balkan and Eastern European countries
the advance of the Red Army resulted in a revolutionary movement not only among
the workers, but among the peasants as well. The reason for this lay in the
whole background of these states, where, before the war, apart from Czechoslovakia,
capitalism was very weak. We had here decaying feudal-military-capitalist dictatorships
whose regimes were completely incapable of further developing the productive
forces of the countries.

The general world crisis of capitalism was particularly exacerbated because
of the backwardness and the artifical splitting up of the area which had followed
the first world war. The very term Balkanisation comes from this part
of Europe. Split up into small weak states, overwhelmingly agrarian in character,
with a very shaky industry, these areas inevitably became almost semi-colonies
of the great powers. France, Britain, and to a certain extent Italy, then Germany,
became the dominant powers of this area. Through her trade relations, German
industry dominated the backward economies of Eastern Europe in the Balkans.
In all these countries foreign capital played an important role. In most of
them, foreign investments were dominant in what little industry existed.

With the occupation of these countries by Hitler, not only was ‘non-Aryan’
capital expropriated, but also the native capitalists were to a large extent
squeezed out and replaced by German banks and trusts. German capital seized
the decisive place - all the key positions and sections of the economy. The
capital that remained was owned by collaborators and Quislings largely, and
remained subordinate to German capital.

The regime was made up of Quislings who relied on German bayonets for their
support. What little popular support was possessed by the pre-war regimes -
military police dictatorships had, in the course of the war, disappeared. With
the collapse of the power of German imperialism and the victory of the Red Army,
an undoubted impulse was given to the socialist revolution. In Bulgaria, for
example, in 1944, the moment the Red Army had crossed the frontier, there was
an uprising in Sofia and other big towns. The masses began the organisation
of soviets or workers’ committees. Soldiers and peasants organised committees
and workers seized the factories.

Similar movements took place in all the countries of Eastern Europe, apart
from Germany. Let us examine what happened in Czechoslovakia. Here too, the
advance of the Red Army was followed by insurrection in Prague, the seizure
of factories by workers and land by peasants. Here too, there was fraternisation
on the borders of Bohemia and Moravia between the Czech and Sudetan-German masses.

The elements of proletarian revolution were quickly followed by Stalinist counter-revolution.
The trouble with Cliff is that he fails to separate out the elements of the
proletarian revolution from the Stalinist counter-revolution which rapidly followed.

Let us take the two examples: Bulgaria and Czechoslovakia. In Bulgaria we had
a situation which has developed over and over again throughout the tragic history
of the working masses. The real power was in the hands of the working class.
The bourgeois state was smashed. How? The Germans had gone; the officers no
longer had control over the soldiers; the police had gone into hiding; the landlords
and capitalists had no control. There was a vacuum; a classical period of dual
power where the masses were not sufficiently conscious to organise their own
power, and the bourgeoisie too weak to reassert their domination.

This is not a situation with which Marxists are unfamiliar: Germany 1918, Russia
1917, Spain 1936. Perhaps a comparison with Spain would be useful. Here too
the masses seized the factories and the land in Catalonia and Aragon. The bourgeois
‘government’ was suspended in mid-air. The masses completely smashed the police
and the army. There was only one armed force: the workers’ militias. All that
was necessary was for the masses to organise sovicts or committees, brush aside
the phantom government and take power.

It is well enough known what took place. The Stalinists proceeded to make a
coalition not with the bourgeoisie - the factory owners and bourgeoisie had
fled to the side of Franco as a consequence of the mass insurrection - but with
the ‘shadow of the bourgeoisie’. The Stalinists did this in Spain with the express
purpose of destroying the socialist revolution for fear of repercussions in
Russia and, of course, because of the existing international line-up and their
desire to demonstrate to the British and French imperialists that they had nothing
to fear. In Spain, therefore, gradually, they helped the shadow to acquire substance.

Gradually they recreated a capitalist army and capitalist police force,
under the control of the capitalist class. Once this had been accomplished,
the land was returned to the landlords and the factories to their owners. The
consequence of this was seen towards the end of the civil war when the bourgeois
state - the bourgeois military machine which they bad helped to create, organised
a coup d’etat which established a military dictatorship in Republican
territory and promptly illegalised the Communist Party itself.

In Bulgaria, as in all other countries of Eastern Europe, the Stalinists proceeded
to make an agreement with the shadow of the bourgeoisie. The socialist
revolution had commenced and there was a danger that it might be carried through
to a conclusion. This, of course, the Stalinists feared. But on the other hand,
they also did not want the power to pass to the bourgeoisie. They derailed
the socialist revolution by organising the so-called Fatherland Front in Bulgaria
and headed off the movement of the masses round slogans of chauvinism and anti-Germanism.
Fraternisation in Bulgaria was swiftly made punishable, the soviets formed in
the army were dissolved, the worker and peasant committees emasculated. They
formed a front of ‘National Unity’, the union of the entire nation. But the
difference with Spain was that here the key positions in this so-called coalition,
where the shadow of the bourgeoisie possessed no power, remained firmly
in Stalinist hands. They took over the police and the army. They selected
the key and commanding personnel. All important positions in the civil service
were placed in the hands of obedient tools. Clearly, behind the screen of national
unity, they concentrated real state power in their hands. They had created
an instrument in their own image - a state machine on the model of Moscow.

The process was crystal clear in the case of Czechoslovakia. When the Stalinists
entered the country there was no government. The Germans with their Quislings
and collaborators had fled. The committees formed by the masses had control
of the industrial enterprises and the land. The Stalinists brought in the government
of Benes(9) from Moscow. The real power, the key posts,
were firmly in their hands; they retained the substance and gave the bourgeoisie
the shadow.

Partly to destroy the socialist revolution, partly to arrive at a compromise
with American imperialism, they allowed certain sectors of the economy to remain
in the hands of private enterprise. But the decisive power, ie, armed bodies
of men, were organised by them and under their control. This was not the same
state machine as previously. It was an entirely new state machine of their
own creation.

In order to derail the revolution the Stalinists played on chauvinism and dealt
the country a terrible blow with the expulsion of the Sudetan Germans. The original
instinct of the masses was on internationalist lines. Reports from Czechoslovakia
show that in the beginning there was fraternisation between the Czechs and Sudetan
Germans. We see how Cliff does not see the element of the counter-revolution,
the activities of the bureaucracy to destroy the revolution and the revolution
itself.

Of course, the attempt of the Stalinists to maintain a compromise with the
bourgeoisie - let it not be forgotten with their control and their state power
- could not continue indefinitely. Shadows can acquire substance. The attempt
of the American bourgeoisie to base themselves on their points of support in
Eastern Europe in the shape of the remnants of the bourgeoisie and those sectors
of the economy which they controlled, with Marshall Aid as the wedge, was the
danger signal. With precipitous speed the bureaucracy acted and ordered all
Eastern European states to reject Marshall Aid. All history has shown the impossibility
of maintaining two antagonistic forms of property. Although the bourgeoisie
were very weak, they had begun to gain a base due to the fact that they retained
a good proportion of light industry under their control. The mounting antagonism
of America, the impossibility of relying on the bourgeoisie, their incompatibility
with a proletarian state with power in the hands of the bureaucracy, forced
the latter to take measures to complete the process. Here we might add that
Trotsky saw in the extension of nationalised property in the areas under Stalinist
domination, proof of the fact that Russia was a workers’ state. The February
events on which world attention has been focused, highlighted in dramatic fashion,
a process taking place in all Stalinist dominated areas. The factor which was
decisive was that the Stalinists had the support of the workers and peasants
in the nationalisations and the division of the land. All Cliff saw was that
the state machine remained the same, presumably, as it was under the Germans.
No doubt the bourgeoisie wished that it had!

According to all observers the Stalinists, because of their compromises and
the disillusionment of the masses in the factories, would probably have lost
votes in the forthcoming elections. The bourgeois elements were gathering strength,
basing themselves on the petty bourgeoisie in the cities and among disillusioned
workers and peasants. Gradually the bourgeoisie hoped to gain control of the
state and organise a counter-revolution with the aid of Anglo-American imperialism.
Although the bureaucracy had control of the state machine, this was precarious
by virtue of the way in which it had been obtained.

In order to complete the process, as Trotsky had foreseen, however cautiously,
the bureaucracy was compelled to call upon the masses. They issued the
call for Action Committees which were bureaucratically controlled at the top,
but were nevertheless relatively democratic at the bottom. The Stalinists armed
the workers, ie, organised a workers’ militia. The enthusiasm of the masses
under these conditions, naturally became apparent. Even the Social Democratic
workers who hated and were distrustful of the Stalinists, enthusiastically participated
in these measures against the bourgeoisie. Trotsky once said that as against
a lion one used a gun, against a flea one’s fingernail. Faced with a Stalinist
state apparatus, with the mass movement as a threat, the bourgeoisie was impotent.

However, the formation of the Action Committees, the arming of the workers,
meant necessarily that an embryo new soviet regime was in the making. Of course,
the bureaucracy speedily proceeded to crush the independence of the masses and
totalitarianise the regime. New elections were rapidly organised on Moscow lines,
with one list and strict supervision.

In the face of these events, Cliff asks:

"What then is the future of the Fourth International; what is its historical
justification? The Stalinist parties have all the advantages over the Fourth
International - a state apparatus, mass organisations, money, etc, etc. The
only advantage they lack is the internationalist class ideology...

"If a social revolution took place in the Eastern European countries without
a revolutionary proletarian leadership, we must conclude that in future social
revolutions, as in the past, the masses will do the fighting but not the leading.
In all the struggles of the bourgeoisie, it was not the bourgeoisie itself who
did the fighting, but the masses who believed it was in their interests. The
sans culottes of the French revolution fought for liberty, equality,
fraternity, while the real aim of the movement was the establishment of the
rule of the bourgeoisie. This was the case at a time when the bourgeoisie was
progressive. In reactionary imperialist wars, the less the masses who are the
cannon fodder know about the war aims, the better soldiers they are. To assume
that the ‘new democracies’ are workers’ states, means to accept that in principle
the proletarian revolution is, just as the bourgeois wars were, based on the
deception of the people...

"If these countries are workers’ states, then why Marxism, why the Fourth
International? We could only be looked upon by the masses as adventurists, or
at best impatient revolutionaries whose differences with the Stalinists are
merely tactical." (Cliff, pages 14-15)

Cliff has addressed the questions to the wrong people. In reality, he should
have posed these questions to himself and he should have given the answers.
If his theory is correct, then the whole theory of Marx becomes a Utopia. Cliff
thinks that if he sticks the label ‘state capitalism’ on to the phenomenon of
Stalinism, he has salved his conscience and has restored the ‘lost’ role of
the Fourth International to his own satisfaction. Here we see the fetishism
of which Marx spoke and which even affects the revolutionary movement: change
the name of a thing and you change its essence.

It is not possible to explain or trace the class historical threads of present
day developments without the existence and degeneration of the workers’ state
in Russia. One can only trace the events in Eastern Europe to the October Revolution
of 1917. It is useless for Cliff to argue that the bureaucracy used the masses
in Czechoslovakia, without posing to himself the question as to who was used
in 1917. Was not the October Revolution followed by the victory of Stalinism?
The good intentions, or the subjective wishes of the Bolshevik leadership or
the working class, is beside the point. According to the theory of Marx, no
society passes from the scene till it has exhausted all the potentialities within
it. If a new period of state capitalism looms ahead - and this necessarily follows
from Cliff’s theory because there can be no economic limit to the development
of production under this so-called state capitalism then to talk of this being
a period of the disintegration of world capitalism reduces itself to mere phrasemongering.
We have the absurdity of a new revolution - a proletarian revolution in 1917,
organically changing the economy into ... state capitalism. We also have the
no less absurd postulation of a revolution in Eastern Europe, where the entire
capitalist class has been expropriated...to install what? Capitalism! A moment’s
serious reflection would show that it is not possible for Cliff to maintain
this position in relation to Eastern Europe without also transferring the same
argument to Russia itself.

Cliff himself points to the fact that in the bourgeois revolution the masses
did the fighting and the bourgeois got the fruits. The masses did not know what
they were fighting for, but they fought in reality for the rule of the bourgeoisie.
Take the French Revolution. It was prepared and had its ideology in the works
of the philosophers of the enlightenment, Voltaire, Rousseau, etc. However,
they really did believe in the idealisation of bourgeois society. They believed
the codicils of liberty, equality and fraternity which they preached. As is
well known, and as Cliff himself quotes Marx to prove, the French Revolution
went beyond its social base. It resulted in the revolutionary dictatorship of
the sans culottes which went beyond the bounds of bourgeois society.
As Marx explained, this had the salutory effect of completing in a few months
what would otherwise have taken the bourgeois decades to do. The leaders of
the revolutionary wing of the petty bourgeoisie which wielded this dictatorship
- Robespierre, Danton, etc, sincerely believed in the doctrines of the philosophers
and attempted to put them into practice. They could not do so because it was
impossible to go beyond the economic base of the given society. They inevitably
had to lose power and merely paved the way for bourgeois society. If Cliff’s
argument is correct, one could only conclude that the same thing happened with
the Russian as with the French Revolution. Marx was the prophet of the new state
capitalism. Lenin and Trotsky were the Robespierres and Carnots of the Russian
Revolution. The fact that Lenin and Trotsky had good intentions is beside the
point, as were the good intentions of the leaders of the bourgeois revolution.
They merely paved the way for the rule of the new state capitalist class.

Thus, if the bureacracy used the masses of Czechoslovakia, and this constitutes
the proof that it is state capitalism, no less did the Russian bureaucracy use
the proletariat in the 1917 revolution. However, this theory can satisfy no
one. The fact that the bureaucracy, because Russia is a workers’ state, with
all its degeneration, has assimilated Eastern Europe into the economy, and instantaneously
strangled the developing socialist revolution, means that simultaneously with
the socialist revolution, they have consciously carried through a process which
extended over many years in Russia. They have telescoped developments in the
image of Russia. This much should be clear: that without the existence of a
strong degenerated workers’ state, contiguous or near to these countries, these
developments would have been impossible. Either the proletariat would have conquered
with a healthy revolution on classical lines and spread the revolution, or imperialism
would have crushed it.

Does this mean that the Stalinists have accomplished the revolution and therefore
there is no need for the Fourth International? Many times in history we are
confronted with a complicated situation. For instance, in the February revolution
in Russia which overthrew Czarism, the masses then proceeded to come under the
influence of the Mensheviks and Social Revolutionaries. This meant that the
masses, having completed one task, the overthrow of Czarism - a political revolution
- created new barriers in their path and had to pay for this by a second revolution
- a social revolution in the form of October. The fact that the masses have
accomplished the basic social revolution in Eastern Europe only to have this
revolution immediately bureaucratised by the Thermidorian bureaucracy, means
that they will now have to pay with a second revolution - a political revolution.

Cliff has only to pose the question: what are the tasks of the Fourth International
in Russia? They are identical with those in Eastern Europe. In order to achieve
socialism the masses must have control of administration and the state. This
the Stalinists can never give. It can only be achieved by a new revolution.
It can only be accomplished with the overthrow of the bureaucracy in Eastern
Europe as in Russia. The tasks of the Fourth International are clear: to
struggle for a political revolution to establish workers’ democracy - a
semi-state and the speedy transition to socialism on the basis of equality.
The form of property will not be changed. The fact that Cliff calls it
a social revolution alters nothing.

Where Trotsky found proof of a workers’ state in the extension of the forms
of property, Cliff finds proof of the reverse.

Cliff may argue, that unless the working class has direct control of the state,
it cannot be a workers’ state. In that case, he will have to reject the idea
that there was a workers’ state in Russia, except possibly in the first few
months. Even here it is necessary to reiterate that the dictatorship of the
proletariat is realised through the instrumentality of the vanguard of the class,
ie the party, and in the party through the party leadership. Under the best
conditions this will be effected with the utmost democracy within the state
and within the party. But the very existence of the dictatorship, its necessity
to achieve the change in the social system, is already proof of profound social
contradictions which can, under unfavourable historical circumstances, find
a reflection within the state and within the party. The party, no more than
the state, can automatically and directly reflect the interests of the class.
Not for nothing did Lenin think of the trade unions as a factor necessary for
the defence of the workers against their state, as well as a bulwark
for the defence of their state.

If it was possible for the party of the working class (the social democracy),
especially through its leadership, to degenerate and fail directly to reflect
the interests of the class before the overthrow of capitalism, why is it impossible
for the state set up by the workers to follow a similar pattern? Whycannot the state gain independence from the class, and parasitically
batten on it while at the same time (in its own interests) defend the new economic
forms created by the revolution? As we have previously shown, Cliff tries to
make a distinction by drawing a metaphysical line at 1928 between when he thinks
surplus value was not consumed by the bureaucracy and when it was. Apart from
being, factually inaccurate, it is a singularly lifeless way of examining the
phenomena.

In reality, the transition from one society to another was found to have been
far more complex than could have been foreseen by the founders of scientific
socialism. No more than any other class or social formation has the proletariat
been given the privilege of inevitably having a smooth passage in the transition
to its domination, and thence to its painless and tranquil disappearance in
society, ie, to socialism. That was a possible variant. But the degeneration
of both social democracy and the soviet state under the given conditions was
not at all accidental. It represented in a sense the complex relations between
a class and its representatives and state, which, more than once in history
the ruling class, bourgeois, feudal and slave-owning, had cause to rue. It mirrors
in other words, the multiplicity of historical factors which are the background
to the decisive factor: the economic.

Contrast the broad view of Lenin with the mechanistic view of Cliff. Lenin
emphasised over and over the need to study the transition periods of past epochs
especially from feudalism to capitalism, in order to understand the laws of
transition in Russia. He would have rejected the conception that the state which
issued from October would have to follow a preconceived norm, or thereby cease
to be a workers’ state.

Lenin well knew that the proletariat and its party and leadership had no god-given
power which would lead, without contradictions, smoothly to socialism once capitalism
had been overthrown. That is necessarily the only conclusion which must follow
from the Kantian norms categorically laid down by Cliff. That is why in advance
Lenin emphasised that the dictatorship of the proletariat would vary tremendously
in different countries and under different conditions.

However, Lenin hammered home the point that in the transition from feudalism
to capitalism the dictatorship of the rising bourgeoisie was reflected in the
dictatorship of one man. A class could rule through the personal rule of one
man. Ex post facto Cliff is quite willing to accept this conception
as it applies to the bourgeoisie. But one could only conclude from his arguments
that such would be impossible in the case of the proletariat. For the rule of
one man implies absolutism, arbitrary dictatorship vested in a single individual
without political rights for the ruling class whose interests, in the last analysis,
he represents. But Lenin only commented thus to show that under certain
conditions the dictatorship of the proletariat could also be realised through
the dictatorship of one man. Lenin did not develop this conception. But
today in the light of the experience of Russia and Eastern Europe and with developments
in China, we can deepen and understand not only the present but the past developments
of society as well.

While the dictatorship of the proletariat can be realised through the dictatorship
of one man, because this implies the separation of the state from the class
it represents, it also means that the apparatus will almost inevitably tend
to become independent of its base and thus acquire a vested interest of its
own, even hostile and alien to the class it represents as in the case of Stalinist
Russia. When we study the development of bourgeois society, we see that the
autocracy of one individual, with the given social contradictions, served the
needs of the development of that society. This is clearly shown by the rule
of Cromwell and Napoleon. But although both stood on a bourgeois base, at a
certain stage bourgeois autocracy becomes, from a favourable factor for the
development of capitalist society, a hindrance to the full and free development
of bourgeois production. However, the dictatorship of absolutism does not then
painlessly wither away. In France and England it required supplementary political
revolutions before bourgeois autocracy could be changed into bourgeois democracy.
But without bourgeois democracy a free and full development of the productive
forces to the limits under capitalism would have been impossible.

If this applies to the historical evolution of the bourgeoisie, how much more
so to the proletariat in a backward and isolated country where the dictatorship
of the proletariat has degenerated into the dictatorship of one man?

For the proletariat to take the path of socialism, a new revolution, a supplementary
political revolution which will turn the Bonapartist proletarian state
into a workers’ democracy is necessary. Such a conception fits in with the experience
of the past. just as capitalism passed through many stormy contradictory phases
(we are far from finished with them yet, as our epoch bears witness) so in the
given historic conditions has the rule of the proletariat in Russia. So also
by a mutual reaction, Eastern Europe and China are passing through this Bonapartist
phase, resulting in the inevitability of new political revolutions in these
countries in order to install workers’ democracy as the prerequisite for a transition
to socialism.

It is in the inter-relation between the class and its state under given historical
conditions that we find the explanation of Stalinist degerieration, not in the
mystical idea that a workers’ state, under all conditions, must be a perfect
workers’ democracy or the transformation of the state into a class. In the long
run, the economic factor, as in bourgeois society, with many upheavals and catastrophes,
will emerge triumphant. The working class, having been enriched by the historical
experience and profiting from its lessons, will victoriously overthrow Stalinist
absolutism and organise a healthy workers’ democracy on a higher level. Then
the state will, more or less, correspond to the ideal norm worked out by Marx
and Lenin.

Notes

(1) Otto von Bismarck, chancellor of the Prussian
government from 1862, introduced the Anti-Socialist Law of 1878. He carried
through the unification of Cermany, under Prussia, by successful wars against
Denmark, Austria-Hungary and then France.

(4) Eugen Dühring was a prominent German social
democrat. In 1874-5 he published works challenging the Marxist ideology of the
German movement, to which Engels replied in Anti-Dühring.

(5) The Moscow Trials of 1936 and 1938 were monstrous
frame-ups resulting in a generation of revolutionaries and opponents of the
bureaucracy being physically exterminated. In 1936 Stalin proposed a new constitution
- it was abandoned on the outbreak of the Spanish Civil War in July 1936, as
the bureaucracy was fearful of repercussions within the USSR.

(6) Stanislaw Mikolafjcik, leader of the Polish
Peasants Party, was the head of the Polish ‘government in exile’ based in London,
from 1943. On liberation in 1945 he became the deputy prime minister in Poland,
but real power lay with the Stalinists, supported by the Red army. By the time
elections were held in 1947 many of his supporters were imprisoned and the party
was later suppressed.

(7) The Jacobins were the extreme radical wing of
the French revolution. Their leader, Maximilien Robespierre (1758-94) wielded
supreme power from 1793 until he was overthrown in 1794 and executed. The Directory
was the government of the First French Republic from 1795-9.

(8) From 1945-8 the French CP held various cabinet
posts in the Government of National Union, headed by de Gaulle. The government
of Henri Quielle, established in September 1948, was attacked by the CP for
being ‘directed against the workers’.

(9) Edvard Benes, a member of the Social Nationalist
Party, was President of Czechoslovakia 1935-38, and from 1941 head of the Czech
provisional government in London. In 1945 he became president of the provisional
government in Czechoslovakia. He resigned in June 1948 in the aftermath of the
‘Prague Coup’.